Correlation Between Inspira Technologies and Icecure Medical

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

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

Diversification Opportunities for Inspira Technologies and Icecure Medical

-0.28

Correlation Coefficient

Inspira Technologies  Icecure Medical

Very good diversification

The 3 months correlation between Inspira and Icecure is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Inspira Technologies Oxy and Icecure Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icecure Medical and Inspira Technologies 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 Inspira Technologies Oxy are associated (or correlated) with Icecure Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icecure Medical has no effect on the direction of Inspira Technologies i.e., Inspira Technologies and Icecure Medical go up and down completely randomly.

Pair Corralation between Inspira Technologies and Icecure Medical

Assuming the 90 days horizon Inspira Technologies is expected to generate 1.08 times less return on investment than Icecure Medical. In addition to that, Inspira Technologies is 3.32 times more volatile than Icecure Medical. It trades about 0.05 of its total potential returns per unit of risk. Icecure Medical is currently generating about 0.18 per unit of volatility. If you would invest  64.00  in Icecure Medical on September 21, 2024 and sell it today you would earn a total of  50.00  from holding Icecure Medical or generate 78.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Inspira Technologies Oxy  vs.  Icecure Medical

Inspira Technologies Oxy

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Inspira Technologies Oxy are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, Inspira Technologies showed solid returns over the last few months and may actually be approaching a breakup point.

Icecure Medical

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Icecure Medical are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting fundamental indicators, Icecure Medical displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Inspira Technologies and Icecure Medical

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

The idea behind Inspira Technologies Oxy and Icecure Medical 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.