Correlation Between XSpray Pharma and Surgical Science

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

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

Diversification Opportunities for XSpray Pharma and Surgical Science

0.39

Correlation Coefficient

XSpray Pharma  Surgical Science

Weak diversification

The 3 months correlation between XSpray and Surgical is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding XSpray Pharma AB and Surgical Science Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surgical Science Sweden and XSpray Pharma 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 XSpray Pharma AB are associated (or correlated) with Surgical Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surgical Science Sweden has no effect on the direction of XSpray Pharma i.e., XSpray Pharma and Surgical Science go up and down completely randomly.

Pair Corralation between XSpray Pharma and Surgical Science

Assuming the 90 days trading horizon XSpray Pharma AB is expected to generate 1.89 times more return on investment than Surgical Science. However, XSpray Pharma is 1.89 times more volatile than Surgical Science Sweden. It trades about 0.15 of its potential returns per unit of risk. Surgical Science Sweden is currently generating about 0.1 per unit of risk. If you would invest  3,705  in XSpray Pharma AB on April 24, 2025 and sell it today you would earn a total of  1,495  from holding XSpray Pharma AB or generate 40.35% return on investment over 90 days.

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

XSpray Pharma AB  vs.  Surgical Science Sweden

XSpray Pharma AB

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in XSpray Pharma AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, XSpray Pharma sustained solid returns over the last few months and may actually be approaching a breakup point.

Surgical Science Sweden

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Surgical Science Sweden are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Surgical Science unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with XSpray Pharma and Surgical Science

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

The idea behind XSpray Pharma AB and Surgical Science Sweden 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.