Correlation Between Mediag3 and LENSAR

Can any of the company-specific risk be diversified away by investing in both Mediag3 and LENSAR 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 Mediag3 and LENSAR into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mediag3 and LENSAR Inc, you can compare the effects of market volatilities on Mediag3 and LENSAR 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 Mediag3 with a short position of LENSAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mediag3 and LENSAR.

Diversification Opportunities for Mediag3 and LENSAR

0.0

Correlation Coefficient

Mediag3  LENSAR

Pay attention - limited upside

The 3 months correlation between Mediag3 and LENSAR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mediag3 and LENSAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LENSAR Inc and Mediag3 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 Mediag3 are associated (or correlated) with LENSAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LENSAR Inc has no effect on the direction of Mediag3 i.e., Mediag3 and LENSAR go up and down completely randomly.

Pair Corralation between Mediag3 and LENSAR

If you would invest  270.00  in LENSAR Inc on September 16, 2024 and sell it today you would earn a total of  485.00  from holding LENSAR Inc or generate 179.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Mediag3  vs.  LENSAR Inc

Mediag3

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mediag3 has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Mediag3 is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

LENSAR Inc

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in LENSAR Inc are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting basic indicators, LENSAR reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mediag3 and LENSAR

The main advantage of trading using opposite Mediag3 and LENSAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mediag3 position performs unexpectedly, LENSAR 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 LENSAR will offset losses from the drop in LENSAR's long position.

The idea behind Mediag3 and LENSAR Inc 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.

Check out your portfolio center.

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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.