Correlation Between Icecure Medical and Plandai Biotech

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

Diversification Opportunities for Icecure Medical and Plandai Biotech

-0.29
  Correlation Coefficient

Very good diversification

The 3 months correlation between Icecure and Plandai is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Icecure Medical and Plandai Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plandai Biotech and Icecure 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 Icecure Medical are associated (or correlated) with Plandai Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plandai Biotech has no effect on the direction of Icecure Medical i.e., Icecure Medical and Plandai Biotech go up and down completely randomly.

Pair Corralation between Icecure Medical and Plandai Biotech

Given the investment horizon of 90 days Icecure Medical is expected to under-perform the Plandai Biotech. But the stock apears to be less risky and, when comparing its historical volatility, Icecure Medical is 10.35 times less risky than Plandai Biotech. The stock trades about -0.03 of its potential returns per unit of risk. The Plandai Biotech is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  0.01  in Plandai Biotech on September 3, 2024 and sell it today you would earn a total of  0.01  from holding Plandai Biotech or generate 100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Icecure Medical  vs.  Plandai Biotech

 Performance 
       Timeline  
Icecure Medical 

Risk-Adjusted Performance

7 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Icecure Medical are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental indicators, Icecure Medical displayed solid returns over the last few months and may actually be approaching a breakup point.
Plandai Biotech 

Risk-Adjusted Performance

17 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Plandai Biotech are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating basic indicators, Plandai Biotech disclosed solid returns over the last few months and may actually be approaching a breakup point.

Icecure Medical and Plandai Biotech Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Icecure Medical and Plandai Biotech

The main advantage of trading using opposite Icecure Medical and Plandai Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Icecure Medical position performs unexpectedly, Plandai Biotech 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 Plandai Biotech will offset losses from the drop in Plandai Biotech's long position.
The idea behind Icecure Medical and Plandai Biotech 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

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