Correlation Between JD Sports and Microbot Medical
Can any of the company-specific risk be diversified away by investing in both JD Sports 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 JD Sports and Microbot Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Sports Fashion and Microbot Medical, you can compare the effects of market volatilities on JD Sports 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 JD Sports with a short position of Microbot Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and Microbot Medical.
Diversification Opportunities for JD Sports and Microbot Medical
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JDDSF and Microbot is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical and JD Sports 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 JD Sports Fashion 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 JD Sports i.e., JD Sports and Microbot Medical go up and down completely randomly.
Pair Corralation between JD Sports and Microbot Medical
Assuming the 90 days horizon JD Sports Fashion is expected to generate 0.5 times more return on investment than Microbot Medical. However, JD Sports Fashion is 1.99 times less risky than Microbot Medical. It trades about 0.03 of its potential returns per unit of risk. Microbot Medical is currently generating about 0.0 per unit of risk. If you would invest 108.00 in JD Sports Fashion on August 26, 2024 and sell it today you would earn a total of 38.00 from holding JD Sports Fashion or generate 35.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Sports Fashion vs. Microbot Medical
Performance |
| Timeline |
| JD Sports Fashion |
| Microbot Medical |
JD Sports and Microbot Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and Microbot Medical
The main advantage of trading using opposite JD Sports and Microbot Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports 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.| JD Sports vs. Burlington Stores | JD Sports vs. Childrens Place | JD Sports vs. Buckle Inc | JD Sports vs. Shoe Carnival |
| Microbot Medical vs. Heartbeam | Microbot Medical vs. EUDA Health Holdings | Microbot Medical vs. Nutex Health | Microbot Medical vs. Healthcare Triangle |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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