Correlation Between Bristol Myers and NLS Pharmaceutics
Can any of the company-specific risk be diversified away by investing in both Bristol Myers and NLS Pharmaceutics 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 Bristol Myers and NLS Pharmaceutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bristol Myers Squibb and NLS Pharmaceutics AG, you can compare the effects of market volatilities on Bristol Myers and NLS Pharmaceutics 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 Bristol Myers with a short position of NLS Pharmaceutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bristol Myers and NLS Pharmaceutics.
Diversification Opportunities for Bristol Myers and NLS Pharmaceutics
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bristol and NLS is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Bristol Myers Squibb and NLS Pharmaceutics AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NLS Pharmaceutics and Bristol Myers 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 Bristol Myers Squibb are associated (or correlated) with NLS Pharmaceutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NLS Pharmaceutics has no effect on the direction of Bristol Myers i.e., Bristol Myers and NLS Pharmaceutics go up and down completely randomly.
Pair Corralation between Bristol Myers and NLS Pharmaceutics
Considering the 90-day investment horizon Bristol Myers Squibb is expected to generate 0.45 times more return on investment than NLS Pharmaceutics. However, Bristol Myers Squibb is 2.22 times less risky than NLS Pharmaceutics. It trades about 0.18 of its potential returns per unit of risk. NLS Pharmaceutics AG is currently generating about -0.05 per unit of risk. If you would invest 5,264 in Bristol Myers Squibb on August 29, 2024 and sell it today you would earn a total of 610.00 from holding Bristol Myers Squibb or generate 11.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bristol Myers Squibb vs. NLS Pharmaceutics AG
Performance |
| Timeline |
| Bristol Myers Squibb |
| NLS Pharmaceutics |
Bristol Myers and NLS Pharmaceutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bristol Myers and NLS Pharmaceutics
The main advantage of trading using opposite Bristol Myers and NLS Pharmaceutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bristol Myers position performs unexpectedly, NLS Pharmaceutics 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 NLS Pharmaceutics will offset losses from the drop in NLS Pharmaceutics' long position.| Bristol Myers vs. Pharvaris BV | Bristol Myers vs. Brinker International | Bristol Myers vs. Alcoa Corp | Bristol Myers vs. Direxion Daily FTSE |
| NLS Pharmaceutics vs. Neurobo Pharmaceuticals | NLS Pharmaceutics vs. Indaptus Therapeutics | NLS Pharmaceutics vs. Pasithea Therapeutics Corp | NLS Pharmaceutics vs. Quoin Pharmaceuticals Ltd |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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