Correlation Between Nable Communications and EyeGene
Can any of the company-specific risk be diversified away by investing in both Nable Communications and EyeGene 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 Nable Communications and EyeGene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nable Communications and EyeGene, you can compare the effects of market volatilities on Nable Communications and EyeGene 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 Nable Communications with a short position of EyeGene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nable Communications and EyeGene.
Diversification Opportunities for Nable Communications and EyeGene
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nable and EyeGene is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Nable Communications and EyeGene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EyeGene and Nable Communications 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 Nable Communications are associated (or correlated) with EyeGene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EyeGene has no effect on the direction of Nable Communications i.e., Nable Communications and EyeGene go up and down completely randomly.
Pair Corralation between Nable Communications and EyeGene
Assuming the 90 days trading horizon Nable Communications is expected to generate 0.73 times more return on investment than EyeGene. However, Nable Communications is 1.38 times less risky than EyeGene. It trades about 0.21 of its potential returns per unit of risk. EyeGene is currently generating about -0.3 per unit of risk. If you would invest 619,000 in Nable Communications on September 10, 2024 and sell it today you would earn a total of 41,000 from holding Nable Communications or generate 6.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nable Communications vs. EyeGene
Performance |
| Timeline |
| Nable Communications |
| EyeGene |
Nable Communications and EyeGene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nable Communications and EyeGene
The main advantage of trading using opposite Nable Communications and EyeGene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nable Communications position performs unexpectedly, EyeGene 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 EyeGene will offset losses from the drop in EyeGene's long position.| Nable Communications vs. Orbitech Co | Nable Communications vs. Intellian Technologies | Nable Communications vs. RFTech Co | Nable Communications vs. PH Tech Co |
| EyeGene vs. Samsung Biologics Co | EyeGene vs. SK Bioscience Co | EyeGene vs. Sk Biopharmaceuticals Co | EyeGene vs. ABL Bio |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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