Correlation Between Neuropace and Electrocore LLC
Can any of the company-specific risk be diversified away by investing in both Neuropace and Electrocore LLC 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 Electrocore LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neuropace and Electrocore LLC, you can compare the effects of market volatilities on Neuropace and Electrocore LLC 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 Electrocore LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neuropace and Electrocore LLC.
Diversification Opportunities for Neuropace and Electrocore LLC
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Neuropace and Electrocore is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Neuropace and Electrocore LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electrocore LLC 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 Electrocore LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electrocore LLC has no effect on the direction of Neuropace i.e., Neuropace and Electrocore LLC go up and down completely randomly.
Pair Corralation between Neuropace and Electrocore LLC
Given the investment horizon of 90 days Neuropace is expected to generate 1.11 times less return on investment than Electrocore LLC. But when comparing it to its historical volatility, Neuropace is 1.13 times less risky than Electrocore LLC. It trades about 0.2 of its potential returns per unit of risk. Electrocore LLC is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 716.00 in Electrocore LLC on October 31, 2024 and sell it today you would earn a total of 842.00 from holding Electrocore LLC or generate 117.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neuropace vs. Electrocore LLC
Performance |
| Timeline |
| Neuropace |
| Electrocore LLC |
Neuropace and Electrocore LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neuropace and Electrocore LLC
The main advantage of trading using opposite Neuropace and Electrocore LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neuropace position performs unexpectedly, Electrocore LLC 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 Electrocore LLC will offset losses from the drop in Electrocore LLC's long position.| Neuropace vs. Integer Holdings Corp | Neuropace vs. Glaukos Corp | Neuropace vs. CONMED | Neuropace vs. Pulmonx Corp |
| Electrocore LLC vs. STRATA Skin Sciences | Electrocore LLC vs. Sight Sciences | Electrocore LLC vs. Neuropace | Electrocore LLC vs. IRIDEX |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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