Correlation Between Inspire Medical and Nemaura Medical

Can any of the company-specific risk be diversified away by investing in both Inspire Medical and Nemaura Medical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Inspire Medical and Nemaura Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Inspire Medical Systems and Nemaura Medical, you can compare the effects of market volatilities on Inspire Medical and Nemaura Medical and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Inspire Medical with a short position of Nemaura Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inspire Medical and Nemaura Medical.

Diversification Opportunities for Inspire Medical and Nemaura Medical

-0.57

Correlation Coefficient

Inspire Medical  Nemaura Medical

Excellent diversification

The 3 months correlation between Inspire and Nemaura is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Inspire Medical Systems and Nemaura Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nemaura Medical and Inspire Medical is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Inspire Medical Systems are associated (or correlated) with Nemaura Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nemaura Medical has no effect on the direction of Inspire Medical i.e., Inspire Medical and Nemaura Medical go up and down completely randomly.

Pair Corralation between Inspire Medical and Nemaura Medical

If you would invest  17,707  in Inspire Medical Systems on August 31, 2024 and sell it today you would earn a total of  1,693  from holding Inspire Medical Systems or generate 9.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.59%
Values	Daily Returns

Inspire Medical Systems  vs.  Nemaura Medical

Inspire Medical Systems

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Inspire Medical Systems are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Inspire Medical may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Nemaura Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nemaura Medical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Nemaura Medical is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Inspire Medical and Nemaura Medical

The main advantage of trading using opposite Inspire Medical and Nemaura Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inspire Medical position performs unexpectedly, Nemaura Medical can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Nemaura Medical will offset losses from the drop in Nemaura Medical's long position.

The idea behind Inspire Medical Systems and Nemaura Medical pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.