Correlation Between Surgery Partners and Airsculpt Technologies

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

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

Diversification Opportunities for Surgery Partners and Airsculpt Technologies

-0.23

Correlation Coefficient

Surgery Partners  Airsculpt Technologies

Very good diversification

The 3 months correlation between Surgery and Airsculpt is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Surgery Partners and Airsculpt Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airsculpt Technologies and Surgery Partners 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 Surgery Partners are associated (or correlated) with Airsculpt Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airsculpt Technologies has no effect on the direction of Surgery Partners i.e., Surgery Partners and Airsculpt Technologies go up and down completely randomly.

Pair Corralation between Surgery Partners and Airsculpt Technologies

Given the investment horizon of 90 days Surgery Partners is expected to under-perform the Airsculpt Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Surgery Partners is 1.5 times less risky than Airsculpt Technologies. The stock trades about -0.05 of its potential returns per unit of risk. The Airsculpt Technologies is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  579.00  in Airsculpt Technologies on September 28, 2024 and sell it today you would lose (15.00) from holding Airsculpt Technologies or give up 2.59% of portfolio value over 90 days.

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

Surgery Partners  vs.  Airsculpt Technologies

Surgery Partners

Risk-Adjusted Performance

0 of 100

Very Weak

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

Airsculpt Technologies

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Airsculpt Technologies are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, Airsculpt Technologies unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Surgery Partners and Airsculpt Technologies

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

The idea behind Surgery Partners and Airsculpt Technologies 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 Stocks Directory module to find actively traded stocks across global markets.