Correlation Between Xtant Medical and United Airlines
Can any of the company-specific risk be diversified away by investing in both Xtant Medical and United Airlines 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 United Airlines 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 United Airlines Holdings, you can compare the effects of market volatilities on Xtant Medical and United Airlines 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 United Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xtant Medical and United Airlines.
Diversification Opportunities for Xtant Medical and United Airlines
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Xtant and United is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and United Airlines Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Airlines Holdings 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 United Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Airlines Holdings has no effect on the direction of Xtant Medical i.e., Xtant Medical and United Airlines go up and down completely randomly.
Pair Corralation between Xtant Medical and United Airlines
Given the investment horizon of 90 days Xtant Medical Holdings is expected to generate 2.62 times more return on investment than United Airlines. However, Xtant Medical is 2.62 times more volatile than United Airlines Holdings. It trades about 0.31 of its potential returns per unit of risk. United Airlines Holdings is currently generating about 0.22 per unit of risk. If you would invest 40.00 in Xtant Medical Holdings on October 22, 2024 and sell it today you would earn a total of 12.00 from holding Xtant Medical Holdings or generate 30.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Xtant Medical Holdings vs. United Airlines Holdings
Performance |
Timeline |
Xtant Medical Holdings |
United Airlines Holdings |
Xtant Medical and United Airlines Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xtant Medical and United Airlines
The main advantage of trading using opposite Xtant Medical and United Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xtant Medical position performs unexpectedly, United Airlines 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 United Airlines will offset losses from the drop in United Airlines' long position.Xtant Medical vs. Neuropace | Xtant Medical vs. Electromed | Xtant Medical vs. Orthopediatrics Corp | Xtant Medical vs. SurModics |
United Airlines vs. American Airlines Group | United Airlines vs. Southwest Airlines | United Airlines vs. JetBlue Airways Corp | United Airlines vs. Delta Air Lines |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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