Correlation Between Pinterest and Xtant Medical

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

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

Diversification Opportunities for Pinterest and Xtant Medical

0.51

Correlation Coefficient

Pinterest  Xtant Medical

Very weak diversification

The 3 months correlation between Pinterest and Xtant is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Pinterest and Xtant Medical Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtant Medical Holdings and Pinterest 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 Pinterest are associated (or correlated) with Xtant Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtant Medical Holdings has no effect on the direction of Pinterest i.e., Pinterest and Xtant Medical go up and down completely randomly.

Pair Corralation between Pinterest and Xtant Medical

Given the investment horizon of 90 days Pinterest is expected to generate 1.15 times more return on investment than Xtant Medical. However, Pinterest is 1.15 times more volatile than Xtant Medical Holdings. It trades about 0.0 of its potential returns per unit of risk. Xtant Medical Holdings is currently generating about -0.38 per unit of risk. If you would invest  2,969  in Pinterest on September 20, 2024 and sell it today you would lose (8.00) from holding Pinterest or give up 0.27% of portfolio value over 90 days.

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

Pinterest  vs.  Xtant Medical Holdings

Pinterest

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pinterest has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Pinterest is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Xtant Medical Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Xtant Medical Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Pinterest and Xtant Medical

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

The idea behind Pinterest and Xtant Medical Holdings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.