Correlation Between Ekso Bionics and Cutera

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

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

Diversification Opportunities for Ekso Bionics and Cutera

0.9

Correlation Coefficient

Ekso Bionics  Cutera

Almost no diversification

The 3 months correlation between Ekso and Cutera is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ekso Bionics Holdings and Cutera Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cutera Inc and Ekso Bionics 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 Ekso Bionics Holdings are associated (or correlated) with Cutera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cutera Inc has no effect on the direction of Ekso Bionics i.e., Ekso Bionics and Cutera go up and down completely randomly.

Pair Corralation between Ekso Bionics and Cutera

Given the investment horizon of 90 days Ekso Bionics Holdings is expected to under-perform the Cutera. But the stock apears to be less risky and, when comparing its historical volatility, Ekso Bionics Holdings is 1.88 times less risky than Cutera. The stock trades about -0.19 of its potential returns per unit of risk. The Cutera Inc is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  66.00  in Cutera Inc on September 4, 2024 and sell it today you would lose (22.00) from holding Cutera Inc or give up 33.33% of portfolio value over 90 days.

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

Ekso Bionics Holdings  vs.  Cutera Inc

Ekso Bionics Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ekso Bionics Holdings 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 very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Cutera Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Cutera Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Ekso Bionics and Cutera

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

The idea behind Ekso Bionics Holdings and Cutera Inc 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.