Correlation Between Xtant Medical and Scope AI

Can any of the company-specific risk be diversified away by investing in both Xtant Medical and Scope AI 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 Scope AI 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 Scope AI Corp, you can compare the effects of market volatilities on Xtant Medical and Scope AI 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 Scope AI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtant Medical and Scope AI.

Diversification Opportunities for Xtant Medical and Scope AI

0.58

Correlation Coefficient

Xtant Medical  Scope AI

Very weak diversification

The 3 months correlation between Xtant and Scope is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and Scope AI Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scope AI 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 Scope AI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scope AI Corp has no effect on the direction of Xtant Medical i.e., Xtant Medical and Scope AI go up and down completely randomly.

Pair Corralation between Xtant Medical and Scope AI

Given the investment horizon of 90 days Xtant Medical Holdings is expected to under-perform the Scope AI. In addition to that, Xtant Medical is 1.28 times more volatile than Scope AI Corp. It trades about -0.04 of its total potential returns per unit of risk. Scope AI Corp is currently generating about -0.02 per unit of volatility. If you would invest  140.00  in Scope AI Corp on October 8, 2024 and sell it today you would lose (42.00) from holding Scope AI Corp or give up 30.0% of portfolio value over 90 days.

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

Xtant Medical Holdings  vs.  Scope AI 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.

Scope AI Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Scope AI Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Scope AI is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Xtant Medical and Scope AI

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

The idea behind Xtant Medical Holdings and Scope AI 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.