Correlation Between SPECTRAL MEDICAL and GLOBUS MEDICAL-A

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

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

Diversification Opportunities for SPECTRAL MEDICAL and GLOBUS MEDICAL-A

-0.66

Correlation Coefficient

SPECTRAL MEDICAL  GLOBUS MEDICAL-A

Excellent diversification

The 3 months correlation between SPECTRAL and GLOBUS is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding SPECTRAL MEDICAL and GLOBUS MEDICAL A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GLOBUS MEDICAL A and SPECTRAL 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 SPECTRAL MEDICAL are associated (or correlated) with GLOBUS MEDICAL-A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GLOBUS MEDICAL A has no effect on the direction of SPECTRAL MEDICAL i.e., SPECTRAL MEDICAL and GLOBUS MEDICAL-A go up and down completely randomly.

Pair Corralation between SPECTRAL MEDICAL and GLOBUS MEDICAL-A

Assuming the 90 days horizon SPECTRAL MEDICAL is expected to under-perform the GLOBUS MEDICAL-A. In addition to that, SPECTRAL MEDICAL is 3.77 times more volatile than GLOBUS MEDICAL A. It trades about -0.02 of its total potential returns per unit of risk. GLOBUS MEDICAL A is currently generating about 0.08 per unit of volatility. If you would invest  7,600  in GLOBUS MEDICAL A on October 9, 2024 and sell it today you would earn a total of  350.00  from holding GLOBUS MEDICAL A or generate 4.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	97.37%
Values	Daily Returns

SPECTRAL MEDICAL  vs.  GLOBUS MEDICAL A

SPECTRAL MEDICAL

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SPECTRAL MEDICAL are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, SPECTRAL MEDICAL is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

GLOBUS MEDICAL A

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GLOBUS MEDICAL A are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, GLOBUS MEDICAL-A exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SPECTRAL MEDICAL and GLOBUS MEDICAL-A

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

The idea behind SPECTRAL MEDICAL and GLOBUS MEDICAL A 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 Commodity Directory module to find actively traded commodities issued by global exchanges.