Correlation Between Senseonics Holdings and Beyond Air

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

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

Diversification Opportunities for Senseonics Holdings and Beyond Air

-0.29

Correlation Coefficient

Senseonics Holdings  Beyond Air

Very good diversification

The 3 months correlation between Senseonics and Beyond is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Senseonics Holdings and Beyond Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Air and Senseonics Holdings 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 Senseonics Holdings are associated (or correlated) with Beyond Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Air has no effect on the direction of Senseonics Holdings i.e., Senseonics Holdings and Beyond Air go up and down completely randomly.

Pair Corralation between Senseonics Holdings and Beyond Air

Given the investment horizon of 90 days Senseonics Holdings is expected to generate 0.68 times more return on investment than Beyond Air. However, Senseonics Holdings is 1.46 times less risky than Beyond Air. It trades about 0.0 of its potential returns per unit of risk. Beyond Air is currently generating about -0.03 per unit of risk. If you would invest  64.00  in Senseonics Holdings on October 5, 2024 and sell it today you would lose (16.70) from holding Senseonics Holdings or give up 26.09% of portfolio value over 90 days.

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

Senseonics Holdings  vs.  Beyond Air

Senseonics Holdings

Risk-Adjusted Performance

8 of 100

OK

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

Beyond Air

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Beyond Air has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, Beyond Air is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Senseonics Holdings and Beyond Air

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

The idea behind Senseonics Holdings and Beyond Air 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.