Correlation Between Tenon Medical, and InspireMD

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

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

Diversification Opportunities for Tenon Medical, and InspireMD

-0.53

Correlation Coefficient

Tenon Medical,  InspireMD

Excellent diversification

The 3 months correlation between Tenon and InspireMD is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Tenon Medical, Warrant and InspireMD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InspireMD and Tenon Medical, 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 Tenon Medical, Warrant are associated (or correlated) with InspireMD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InspireMD has no effect on the direction of Tenon Medical, i.e., Tenon Medical, and InspireMD go up and down completely randomly.

Pair Corralation between Tenon Medical, and InspireMD

Assuming the 90 days horizon Tenon Medical, Warrant is expected to generate 5.92 times more return on investment than InspireMD. However, Tenon Medical, is 5.92 times more volatile than InspireMD. It trades about 0.13 of its potential returns per unit of risk. InspireMD is currently generating about 0.06 per unit of risk. If you would invest  10.00  in Tenon Medical, Warrant on October 11, 2024 and sell it today you would lose (8.02) from holding Tenon Medical, Warrant or give up 80.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	54.34%
Values	Daily Returns

Tenon Medical, Warrant  vs.  InspireMD

Tenon Medical, Warrant

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tenon Medical, Warrant are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Tenon Medical, showed solid returns over the last few months and may actually be approaching a breakup point.

InspireMD

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in InspireMD are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile basic indicators, InspireMD may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Tenon Medical, and InspireMD

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

The idea behind Tenon Medical, Warrant and InspireMD 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.