Correlation Between Inogen and Icecure Medical

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

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

Diversification Opportunities for Inogen and Icecure Medical

-0.48

Correlation Coefficient

Inogen  Icecure Medical

Very good diversification

The 3 months correlation between Inogen and Icecure is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Inogen Inc and Icecure Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icecure Medical and Inogen 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 Inogen Inc 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 Inogen i.e., Inogen and Icecure Medical go up and down completely randomly.

Pair Corralation between Inogen and Icecure Medical

Given the investment horizon of 90 days Inogen Inc is expected to under-perform the Icecure Medical. But the stock apears to be less risky and, when comparing its historical volatility, Inogen Inc is 1.76 times less risky than Icecure Medical. The stock trades about -0.04 of its potential returns per unit of risk. The Icecure Medical is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  61.00  in Icecure Medical on September 30, 2024 and sell it today you would earn a total of  51.00  from holding Icecure Medical or generate 83.61% return on investment over 90 days.

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

Inogen Inc  vs.  Icecure Medical

Inogen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Inogen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's technical and fundamental indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Icecure Medical

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Icecure Medical are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Icecure Medical displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Inogen and Icecure Medical

The main advantage of trading using opposite Inogen and Icecure Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inogen 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 Inogen Inc 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.