Correlation Between QT Imaging and Xtant Medical

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

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

Diversification Opportunities for QT Imaging and Xtant Medical

-0.32

Correlation Coefficient

QT Imaging  Xtant Medical

Very good diversification

The 3 months correlation between QTI and Xtant is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding QT Imaging Holdings and Xtant Medical Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtant Medical Holdings and QT Imaging 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 QT Imaging Holdings are associated (or correlated) with Xtant Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtant Medical Holdings has no effect on the direction of QT Imaging i.e., QT Imaging and Xtant Medical go up and down completely randomly.

Pair Corralation between QT Imaging and Xtant Medical

Considering the 90-day investment horizon QT Imaging Holdings is expected to generate 2.16 times more return on investment than Xtant Medical. However, QT Imaging is 2.16 times more volatile than Xtant Medical Holdings. It trades about 0.11 of its potential returns per unit of risk. Xtant Medical Holdings is currently generating about 0.11 per unit of risk. If you would invest  44.00  in QT Imaging Holdings on December 17, 2024 and sell it today you would earn a total of  19.00  from holding QT Imaging Holdings or generate 43.18% return on investment over 90 days.

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

QT Imaging Holdings  vs.  Xtant Medical Holdings

QT Imaging Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in QT Imaging Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, QT Imaging demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Xtant Medical Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Xtant Medical Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Xtant Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with QT Imaging and Xtant Medical

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

The idea behind QT Imaging Holdings and Xtant Medical Holdings 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.