Correlation Between Microbot Medical and Cumberland Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Microbot Medical and Cumberland Pharmaceuticals 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 Cumberland Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microbot Medical and Cumberland Pharmaceuticals, you can compare the effects of market volatilities on Microbot Medical and Cumberland Pharmaceuticals 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 Cumberland Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microbot Medical and Cumberland Pharmaceuticals.
Diversification Opportunities for Microbot Medical and Cumberland Pharmaceuticals
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Microbot and Cumberland is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and Cumberland Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cumberland Pharmaceuticals 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 Cumberland Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cumberland Pharmaceuticals has no effect on the direction of Microbot Medical i.e., Microbot Medical and Cumberland Pharmaceuticals go up and down completely randomly.
Pair Corralation between Microbot Medical and Cumberland Pharmaceuticals
Given the investment horizon of 90 days Microbot Medical is expected to generate 1.37 times more return on investment than Cumberland Pharmaceuticals. However, Microbot Medical is 1.37 times more volatile than Cumberland Pharmaceuticals. It trades about 0.02 of its potential returns per unit of risk. Cumberland Pharmaceuticals is currently generating about 0.0 per unit of risk. If you would invest 100.00 in Microbot Medical on August 29, 2024 and sell it today you would lose (3.00) from holding Microbot Medical or give up 3.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microbot Medical vs. Cumberland Pharmaceuticals
Performance |
| Timeline |
| Microbot Medical |
| Cumberland Pharmaceuticals |
Microbot Medical and Cumberland Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microbot Medical and Cumberland Pharmaceuticals
The main advantage of trading using opposite Microbot Medical and Cumberland Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microbot Medical position performs unexpectedly, Cumberland Pharmaceuticals 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 Cumberland Pharmaceuticals will offset losses from the drop in Cumberland Pharmaceuticals' long position.| Microbot Medical vs. Intuitive Surgical | Microbot Medical vs. Innerscope Advertising Agency | Microbot Medical vs. Predictive Oncology | Microbot Medical vs. STAAR Surgical |
| Cumberland Pharmaceuticals vs. Phibro Animal Health | Cumberland Pharmaceuticals vs. Procaps Group SA | Cumberland Pharmaceuticals vs. Amphastar P | Cumberland Pharmaceuticals vs. Alkermes Plc |
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 Stocks Directory module to find actively traded stocks across global markets.
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