Correlation Between Procept Biorobotics and Baxter International

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

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

Diversification Opportunities for Procept Biorobotics and Baxter International

-0.84

Correlation Coefficient

Procept Biorobotics  Baxter International

Pay attention - limited upside

The 3 months correlation between Procept and Baxter is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Procept Biorobotics Corp and Baxter International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baxter International and Procept Biorobotics 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 Procept Biorobotics Corp are associated (or correlated) with Baxter International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baxter International has no effect on the direction of Procept Biorobotics i.e., Procept Biorobotics and Baxter International go up and down completely randomly.

Pair Corralation between Procept Biorobotics and Baxter International

Given the investment horizon of 90 days Procept Biorobotics Corp is expected to under-perform the Baxter International. In addition to that, Procept Biorobotics is 1.77 times more volatile than Baxter International. It trades about -0.12 of its total potential returns per unit of risk. Baxter International is currently generating about 0.16 per unit of volatility. If you would invest  2,849  in Baxter International on December 28, 2024 and sell it today you would earn a total of  521.00  from holding Baxter International or generate 18.29% return on investment over 90 days.

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

Procept Biorobotics Corp  vs.  Baxter International

Procept Biorobotics Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Procept Biorobotics Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Baxter International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Baxter International are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Baxter International showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Procept Biorobotics and Baxter International

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

The idea behind Procept Biorobotics Corp and Baxter International 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.