Correlation Between NuVasive and Axogen

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

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

Diversification Opportunities for NuVasive and Axogen

-0.26

Correlation Coefficient

NuVasive  Axogen

Very good diversification

The 3 months correlation between NuVasive and Axogen is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding NuVasive and Axogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axogen Inc and NuVasive 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 NuVasive are associated (or correlated) with Axogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axogen Inc has no effect on the direction of NuVasive i.e., NuVasive and Axogen go up and down completely randomly.

Pair Corralation between NuVasive and Axogen

If you would invest  1,315  in Axogen Inc on September 2, 2024 and sell it today you would earn a total of  75.00  from holding Axogen Inc or generate 5.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

NuVasive  vs.  Axogen Inc

NuVasive

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NuVasive has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, NuVasive is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Axogen Inc

Risk-Adjusted Performance

3 of 100

Insignificant

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

Pair Trading with NuVasive and Axogen

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

The idea behind NuVasive and Axogen 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.