Correlation Between SurModics and Accuray Incorporated

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

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

Diversification Opportunities for SurModics and Accuray Incorporated

0.52

Correlation Coefficient

SurModics  Accuray Incorporated

Very weak diversification

The 3 months correlation between SurModics and Accuray is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding SurModics and Accuray Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accuray Incorporated and SurModics 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 SurModics are associated (or correlated) with Accuray Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accuray Incorporated has no effect on the direction of SurModics i.e., SurModics and Accuray Incorporated go up and down completely randomly.

Pair Corralation between SurModics and Accuray Incorporated

Given the investment horizon of 90 days SurModics is expected to generate 15.88 times less return on investment than Accuray Incorporated. But when comparing it to its historical volatility, SurModics is 6.56 times less risky than Accuray Incorporated. It trades about 0.02 of its potential returns per unit of risk. Accuray Incorporated is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  211.00  in Accuray Incorporated on September 2, 2024 and sell it today you would earn a total of  12.00  from holding Accuray Incorporated or generate 5.69% return on investment over 90 days.

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

SurModics  vs.  Accuray Incorporated

SurModics

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SurModics are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong fundamental indicators, SurModics is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Accuray Incorporated

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Accuray Incorporated are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Accuray Incorporated may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with SurModics and Accuray Incorporated

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

The idea behind SurModics and Accuray Incorporated 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.