Correlation Between Haemonetics and AtriCure

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

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

Diversification Opportunities for Haemonetics and AtriCure

-0.83

Correlation Coefficient

Haemonetics  AtriCure

Pay attention - limited upside

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

Pair Corralation between Haemonetics and AtriCure

Considering the 90-day investment horizon Haemonetics is expected to generate 0.42 times more return on investment than AtriCure. However, Haemonetics is 2.35 times less risky than AtriCure. It trades about 0.32 of its potential returns per unit of risk. AtriCure is currently generating about -0.26 per unit of risk. 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

Haemonetics  vs.  AtriCure

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.

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.

Pair Trading with Haemonetics and AtriCure

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

The idea behind Haemonetics and AtriCure 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.