Correlation Between EnVVeno Medical and Tenon Medical

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

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

Diversification Opportunities for EnVVeno Medical and Tenon Medical

0.0

Correlation Coefficient

EnVVeno Medical  Tenon Medical

Pay attention - limited upside

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

Pair Corralation between EnVVeno Medical and Tenon Medical

Given the investment horizon of 90 days enVVeno Medical Corp is expected to under-perform the Tenon Medical. But the stock apears to be less risky and, when comparing its historical volatility, enVVeno Medical Corp is 9.83 times less risky than Tenon Medical. The stock trades about -0.02 of its potential returns per unit of risk. The Tenon Medical is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  191.00  in Tenon Medical on December 29, 2024 and sell it today you would earn a total of  89.00  from holding Tenon Medical or generate 46.6% return on investment over 90 days.

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

enVVeno Medical Corp  vs.  Tenon Medical

enVVeno Medical Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days enVVeno Medical Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, EnVVeno Medical is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Tenon Medical

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tenon Medical are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Tenon Medical displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with EnVVeno Medical and Tenon Medical

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

The idea behind enVVeno Medical Corp and Tenon 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.

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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.