Correlation Between InspireMD and EnVVeno Medical

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

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

Diversification Opportunities for InspireMD and EnVVeno Medical

-0.72

Correlation Coefficient

InspireMD  EnVVeno Medical

Pay attention - limited upside

The 3 months correlation between InspireMD and EnVVeno is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding InspireMD and enVVeno Medical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on enVVeno Medical Corp and InspireMD 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 InspireMD are associated (or correlated) with EnVVeno Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of enVVeno Medical Corp has no effect on the direction of InspireMD i.e., InspireMD and EnVVeno Medical go up and down completely randomly.

Pair Corralation between InspireMD and EnVVeno Medical

Given the investment horizon of 90 days InspireMD is expected to under-perform the EnVVeno Medical. But the stock apears to be less risky and, when comparing its historical volatility, InspireMD is 2.3 times less risky than EnVVeno Medical. The stock trades about -0.27 of its potential returns per unit of risk. The enVVeno Medical Corp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  293.00  in enVVeno Medical Corp on October 12, 2024 and sell it today you would earn a total of  43.00  from holding enVVeno Medical Corp or generate 14.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

InspireMD  vs.  enVVeno Medical Corp

InspireMD

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in InspireMD are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, InspireMD may actually be approaching a critical reversion point that can send shares even higher in February 2025.

enVVeno Medical Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in enVVeno Medical Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, EnVVeno Medical may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with InspireMD and EnVVeno Medical

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

The idea behind InspireMD and enVVeno Medical Corp 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.