Correlation Between Acco Brands and Microbot Medical

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Can any of the company-specific risk be diversified away by investing in both Acco Brands and Microbot 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 Acco Brands and Microbot Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Microbot Medical, you can compare the effects of market volatilities on Acco Brands and Microbot 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 Acco Brands with a short position of Microbot Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Microbot Medical.

Diversification Opportunities for Acco Brands and Microbot Medical

0.05
  Correlation Coefficient

Significant diversification

The 3 months correlation between Acco and Microbot is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical and Acco Brands 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 Acco Brands are associated (or correlated) with Microbot Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbot Medical has no effect on the direction of Acco Brands i.e., Acco Brands and Microbot Medical go up and down completely randomly.

Pair Corralation between Acco Brands and Microbot Medical

Given the investment horizon of 90 days Acco Brands is expected to generate 1.03 times more return on investment than Microbot Medical. However, Acco Brands is 1.03 times more volatile than Microbot Medical. It trades about 0.31 of its potential returns per unit of risk. Microbot Medical is currently generating about 0.05 per unit of risk. If you would invest  481.00  in Acco Brands on August 25, 2024 and sell it today you would earn a total of  101.00  from holding Acco Brands or generate 21.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Acco Brands  vs.  Microbot Medical

 Performance 
       Timeline  
Acco Brands 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Acco Brands are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Acco Brands may actually be approaching a critical reversion point that can send shares even higher in December 2024.
Microbot Medical 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Microbot Medical is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Acco Brands and Microbot Medical Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Acco Brands and Microbot Medical

The main advantage of trading using opposite Acco Brands and Microbot Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Microbot 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 Microbot Medical will offset losses from the drop in Microbot Medical's long position.
The idea behind Acco Brands and Microbot 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.

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