Correlation Between Tevano Systems and Avinger

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

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

Diversification Opportunities for Tevano Systems and Avinger

0.5

Correlation Coefficient

Tevano Systems  Avinger

Very weak diversification

The 3 months correlation between Tevano and Avinger is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Tevano Systems Holdings and Avinger in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avinger and Tevano Systems 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 Tevano Systems Holdings are associated (or correlated) with Avinger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avinger has no effect on the direction of Tevano Systems i.e., Tevano Systems and Avinger go up and down completely randomly.

Pair Corralation between Tevano Systems and Avinger

Assuming the 90 days horizon Tevano Systems Holdings is expected to under-perform the Avinger. In addition to that, Tevano Systems is 2.15 times more volatile than Avinger. It trades about -0.13 of its total potential returns per unit of risk. Avinger is currently generating about -0.06 per unit of volatility. If you would invest  118.00  in Avinger on September 12, 2024 and sell it today you would lose (36.00) from holding Avinger or give up 30.51% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.31%
Values	Daily Returns

Tevano Systems Holdings  vs.  Avinger

Tevano Systems Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tevano Systems Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Avinger

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Avinger has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Tevano Systems and Avinger

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

The idea behind Tevano Systems Holdings and Avinger 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.