Correlation Between Xtant Medical and GENERAL

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

Diversification Opportunities for Xtant Medical and GENERAL

0.32

Correlation Coefficient

Xtant Medical  GENERAL

Weak diversification

The 3 months correlation between Xtant and GENERAL is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Xtant Medical Holdings and GENERAL ELECTRIC CO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GENERAL ELECTRIC 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 GENERAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GENERAL ELECTRIC has no effect on the direction of Xtant Medical i.e., Xtant Medical and GENERAL go up and down completely randomly.

Pair Corralation between Xtant Medical and GENERAL

Given the investment horizon of 90 days Xtant Medical Holdings is expected to under-perform the GENERAL. In addition to that, Xtant Medical is 5.71 times more volatile than GENERAL ELECTRIC CO. It trades about -0.02 of its total potential returns per unit of risk. GENERAL ELECTRIC CO is currently generating about -0.06 per unit of volatility. If you would invest  9,381  in GENERAL ELECTRIC CO on October 26, 2024 and sell it today you would lose (421.00) from holding GENERAL ELECTRIC CO or give up 4.49% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	66.13%
Values	Daily Returns

Xtant Medical Holdings  vs.  GENERAL ELECTRIC CO

Xtant Medical Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Xtant Medical Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Xtant Medical is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

GENERAL ELECTRIC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GENERAL ELECTRIC CO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for GENERAL ELECTRIC CO investors.

Pair Trading with Xtant Medical and GENERAL

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

The idea behind Xtant Medical Holdings and GENERAL ELECTRIC CO 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.