Correlation Between Avantor and Masimo
Can any of the company-specific risk be diversified away by investing in both Avantor and Masimo 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 Avantor and Masimo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avantor and Masimo, you can compare the effects of market volatilities on Avantor and Masimo 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 Avantor with a short position of Masimo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avantor and Masimo.
Diversification Opportunities for Avantor and Masimo
Modest diversification
The 3 months correlation between Avantor and Masimo is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Avantor and Masimo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Masimo and Avantor 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 Avantor are associated (or correlated) with Masimo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Masimo has no effect on the direction of Avantor i.e., Avantor and Masimo go up and down completely randomly.
Pair Corralation between Avantor and Masimo
Given the investment horizon of 90 days Avantor is expected to under-perform the Masimo. In addition to that, Avantor is 2.21 times more volatile than Masimo. It trades about -0.02 of its total potential returns per unit of risk. Masimo is currently generating about -0.02 per unit of volatility. If you would invest 14,424 in Masimo on August 21, 2025 and sell it today you would lose (408.00) from holding Masimo or give up 2.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Avantor vs. Masimo
Performance |
| Timeline |
| Avantor |
| Masimo |
Avantor and Masimo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avantor and Masimo
The main advantage of trading using opposite Avantor and Masimo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avantor position performs unexpectedly, Masimo 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 Masimo will offset losses from the drop in Masimo's long position.The idea behind Avantor and Masimo 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.Check out your portfolio center.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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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