Correlation Between Xtant Medical and Dennys Corp

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

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

Diversification Opportunities for Xtant Medical and Dennys Corp

0.26

Correlation Coefficient

Xtant Medical  Dennys Corp

Modest diversification

The 3 months correlation between Xtant and Dennys is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and Dennys Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dennys Corp and Xtant 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 Xtant Medical Holdings are associated (or correlated) with Dennys Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dennys Corp has no effect on the direction of Xtant Medical i.e., Xtant Medical and Dennys Corp go up and down completely randomly.

Pair Corralation between Xtant Medical and Dennys Corp

Given the investment horizon of 90 days Xtant Medical Holdings is expected to generate 1.6 times more return on investment than Dennys Corp. However, Xtant Medical is 1.6 times more volatile than Dennys Corp. It trades about 0.02 of its potential returns per unit of risk. Dennys Corp is currently generating about -0.11 per unit of risk. If you would invest  53.00  in Xtant Medical Holdings on October 7, 2024 and sell it today you would earn a total of  0.00  from holding Xtant Medical Holdings or generate 0.0% return on investment over 90 days.

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

Xtant Medical Holdings  vs.  Dennys Corp

Xtant Medical Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xtant Medical Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Dennys Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Dennys Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Dennys Corp may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Xtant Medical and Dennys Corp

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

The idea behind Xtant Medical Holdings and Dennys Corp 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.