Correlation Between Sight Sciences and Hologic

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

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

Diversification Opportunities for Sight Sciences and Hologic

0.89

Correlation Coefficient

Sight Sciences  Hologic

Very poor diversification

The 3 months correlation between Sight and Hologic is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Sight Sciences and Hologic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hologic and Sight Sciences 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 Sight Sciences are associated (or correlated) with Hologic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hologic has no effect on the direction of Sight Sciences i.e., Sight Sciences and Hologic go up and down completely randomly.

Pair Corralation between Sight Sciences and Hologic

Given the investment horizon of 90 days Sight Sciences is expected to under-perform the Hologic. In addition to that, Sight Sciences is 3.37 times more volatile than Hologic. It trades about -0.03 of its total potential returns per unit of risk. Hologic is currently generating about -0.05 per unit of volatility. If you would invest  7,633  in Hologic on December 4, 2024 and sell it today you would lose (1,306) from holding Hologic or give up 17.11% of portfolio value over 90 days.

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

Sight Sciences  vs.  Hologic

Sight Sciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sight Sciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical 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.

Hologic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hologic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's essential indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Sight Sciences and Hologic

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

The idea behind Sight Sciences and Hologic 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 Transaction History module to view history of all your transactions and understand their impact on performance.