Correlation Between SurModics and Beyond Air

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

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

Diversification Opportunities for SurModics and Beyond Air

0.22

Correlation Coefficient

SurModics  Beyond Air

Modest diversification

The 3 months correlation between SurModics and Beyond is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding SurModics and Beyond Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Air 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 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 SurModics i.e., SurModics and Beyond Air go up and down completely randomly.

Pair Corralation between SurModics and Beyond Air

Given the investment horizon of 90 days SurModics is expected to generate 0.09 times more return on investment than Beyond Air. However, SurModics is 11.51 times less risky than Beyond Air. It trades about -0.08 of its potential returns per unit of risk. Beyond Air is currently generating about -0.02 per unit of risk. If you would invest  4,224  in SurModics on October 7, 2024 and sell it today you would lose (272.00) from holding SurModics or give up 6.44% of portfolio value over 90 days.

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

SurModics  vs.  Beyond Air

SurModics

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SurModics are ranked lower than 7 (%) 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.

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 SurModics and Beyond Air

The main advantage of trading using opposite SurModics and Beyond Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SurModics 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 SurModics 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.