Correlation Between Helius Medical and ViewRay

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

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

Diversification Opportunities for Helius Medical and ViewRay

-0.31

Correlation Coefficient

Helius Medical  ViewRay

Very good diversification

The 3 months correlation between Helius and ViewRay is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Helius Medical Technologies and ViewRay in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ViewRay and Helius 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 Helius Medical Technologies are associated (or correlated) with ViewRay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ViewRay has no effect on the direction of Helius Medical i.e., Helius Medical and ViewRay go up and down completely randomly.

Pair Corralation between Helius Medical and ViewRay

Given the investment horizon of 90 days Helius Medical Technologies is expected to generate 0.77 times more return on investment than ViewRay. However, Helius Medical Technologies is 1.3 times less risky than ViewRay. It trades about -0.04 of its potential returns per unit of risk. ViewRay is currently generating about -0.24 per unit of risk. If you would invest  1,348  in Helius Medical Technologies on September 30, 2024 and sell it today you would lose (1,278) from holding Helius Medical Technologies or give up 94.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	27.36%
Values	Daily Returns

Helius Medical Technologies  vs.  ViewRay

Helius Medical Techn

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Helius Medical Technologies are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent fundamental indicators, Helius Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

ViewRay

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ViewRay has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, ViewRay is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Helius Medical and ViewRay

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

The idea behind Helius Medical Technologies and ViewRay 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.