Correlation Between Tivic Health and SurModics

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

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

Diversification Opportunities for Tivic Health and SurModics

-0.44

Correlation Coefficient

Tivic Health  SurModics

Very good diversification

The 3 months correlation between Tivic and SurModics is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Tivic Health Systems and SurModics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SurModics and Tivic Health 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 Tivic Health Systems are associated (or correlated) with SurModics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SurModics has no effect on the direction of Tivic Health i.e., Tivic Health and SurModics go up and down completely randomly.

Pair Corralation between Tivic Health and SurModics

Given the investment horizon of 90 days Tivic Health Systems is expected to generate 15.0 times more return on investment than SurModics. However, Tivic Health is 15.0 times more volatile than SurModics. It trades about 0.09 of its potential returns per unit of risk. SurModics is currently generating about -0.16 per unit of risk. If you would invest  27.00  in Tivic Health Systems on December 1, 2024 and sell it today you would earn a total of  9.00  from holding Tivic Health Systems or generate 33.33% return on investment over 90 days.

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

Tivic Health Systems  vs.  SurModics

Tivic Health Systems

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tivic Health Systems are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Tivic Health exhibited solid returns over the last few months and may actually be approaching a breakup point.

SurModics

Risk-Adjusted Performance

Very Weak

Over the last 90 days SurModics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental 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 Tivic Health and SurModics

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

The idea behind Tivic Health Systems and SurModics 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.

Check out your portfolio center.

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.