Correlation Between Neuropace and Apyx Medical
Can any of the company-specific risk be diversified away by investing in both Neuropace and Apyx 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 Neuropace and Apyx Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neuropace and Apyx Medical, you can compare the effects of market volatilities on Neuropace and Apyx 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 Neuropace with a short position of Apyx Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuropace and Apyx Medical.
Diversification Opportunities for Neuropace and Apyx Medical
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Neuropace and Apyx is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Neuropace and Apyx Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apyx Medical and Neuropace 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 Neuropace are associated (or correlated) with Apyx Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apyx Medical has no effect on the direction of Neuropace i.e., Neuropace and Apyx Medical go up and down completely randomly.
Pair Corralation between Neuropace and Apyx Medical
Given the investment horizon of 90 days Neuropace is expected to generate 1.13 times more return on investment than Apyx Medical. However, Neuropace is 1.13 times more volatile than Apyx Medical. It trades about 0.33 of its potential returns per unit of risk. Apyx Medical is currently generating about 0.21 per unit of risk. If you would invest 590.00 in Neuropace on August 24, 2024 and sell it today you would earn a total of 380.00 from holding Neuropace or generate 64.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neuropace vs. Apyx Medical
Performance |
| Timeline |
| Neuropace |
| Apyx Medical |
Neuropace and Apyx Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neuropace and Apyx Medical
The main advantage of trading using opposite Neuropace and Apyx Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuropace position performs unexpectedly, Apyx 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 Apyx Medical will offset losses from the drop in Apyx Medical's long position.| Neuropace vs. Electromed | Neuropace vs. Orthopediatrics Corp | Neuropace vs. SurModics | Neuropace vs. Paragon 28 |
| Apyx Medical vs. Neuropace | Apyx Medical vs. Inogen Inc | Apyx Medical vs. SurModics | Apyx Medical vs. Pulmonx Corp |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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