Correlation Between AtriCure and Haemonetics

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

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

Diversification Opportunities for AtriCure and Haemonetics

-0.83

Correlation Coefficient

AtriCure  Haemonetics

Pay attention - limited upside

The 3 months correlation between AtriCure and Haemonetics is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding AtriCure and Haemonetics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haemonetics and AtriCure 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 AtriCure are associated (or correlated) with Haemonetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haemonetics has no effect on the direction of AtriCure i.e., AtriCure and Haemonetics go up and down completely randomly.

Pair Corralation between AtriCure and Haemonetics

Given the investment horizon of 90 days AtriCure is expected to under-perform the Haemonetics. In addition to that, AtriCure is 2.35 times more volatile than Haemonetics. It trades about -0.26 of its total potential returns per unit of risk. Haemonetics is currently generating about 0.32 per unit of volatility. If you would invest  8,489  in Haemonetics on February 4, 2024 and sell it today you would earn a total of  951.00  from holding Haemonetics or generate 11.2% return on investment over 90 days.

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

AtriCure  vs.  Haemonetics

AtriCure

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AtriCure has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in June 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Haemonetics

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Haemonetics are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Haemonetics exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AtriCure and Haemonetics

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

The idea behind AtriCure and Haemonetics 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 Stocks Directory module to find actively traded stocks across global markets.