Correlation Between Vapotherm and Bluejay Diagnostics

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

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

Diversification Opportunities for Vapotherm and Bluejay Diagnostics

0.0

Correlation Coefficient

Vapotherm  Bluejay Diagnostics

Pay attention - limited upside

The 3 months correlation between Vapotherm and Bluejay is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Vapotherm and Bluejay Diagnostics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluejay Diagnostics and Vapotherm 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 Vapotherm are associated (or correlated) with Bluejay Diagnostics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluejay Diagnostics has no effect on the direction of Vapotherm i.e., Vapotherm and Bluejay Diagnostics go up and down completely randomly.

Pair Corralation between Vapotherm and Bluejay Diagnostics

If you would invest  363.00  in Bluejay Diagnostics on December 21, 2024 and sell it today you would earn a total of  32.00  from holding Bluejay Diagnostics or generate 8.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Vapotherm  vs.  Bluejay Diagnostics

Vapotherm

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vapotherm has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Vapotherm is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Bluejay Diagnostics

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Bluejay Diagnostics are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile fundamental indicators, Bluejay Diagnostics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vapotherm and Bluejay Diagnostics

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

The idea behind Vapotherm and Bluejay Diagnostics 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.