Correlation Between Microbot Medical and Apple
Can any of the company-specific risk be diversified away by investing in both Microbot Medical and Apple 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 Microbot Medical and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microbot Medical and Apple Inc, you can compare the effects of market volatilities on Microbot Medical and Apple 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 Microbot Medical with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microbot Medical and Apple.
Diversification Opportunities for Microbot Medical and Apple
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Microbot and Apple is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Microbot Medical 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 Microbot Medical are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of Microbot Medical i.e., Microbot Medical and Apple go up and down completely randomly.
Pair Corralation between Microbot Medical and Apple
Assuming the 90 days trading horizon Microbot Medical is expected to generate 2.07 times more return on investment than Apple. However, Microbot Medical is 2.07 times more volatile than Apple Inc. It trades about 0.07 of its potential returns per unit of risk. Apple Inc is currently generating about 0.1 per unit of risk. If you would invest 84.00 in Microbot Medical on August 28, 2024 and sell it today you would earn a total of 9.00 from holding Microbot Medical or generate 10.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microbot Medical vs. Apple Inc
Performance |
| Timeline |
| Microbot Medical |
| Apple Inc |
Microbot Medical and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microbot Medical and Apple
The main advantage of trading using opposite Microbot Medical and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microbot Medical position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| Microbot Medical vs. Apple Inc | Microbot Medical vs. Apple Inc | Microbot Medical vs. Apple Inc | Microbot Medical vs. Apple Inc |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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