Correlation Between Novacyt SA and Cytosorbents Crp
Can any of the company-specific risk be diversified away by investing in both Novacyt SA and Cytosorbents Crp 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 Novacyt SA and Cytosorbents Crp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Novacyt SA and Cytosorbents Crp, you can compare the effects of market volatilities on Novacyt SA and Cytosorbents Crp 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 Novacyt SA with a short position of Cytosorbents Crp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Novacyt SA and Cytosorbents Crp.
Diversification Opportunities for Novacyt SA and Cytosorbents Crp
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Novacyt and Cytosorbents is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Novacyt SA and Cytosorbents Crp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cytosorbents Crp and Novacyt SA 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 Novacyt SA are associated (or correlated) with Cytosorbents Crp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cytosorbents Crp has no effect on the direction of Novacyt SA i.e., Novacyt SA and Cytosorbents Crp go up and down completely randomly.
Pair Corralation between Novacyt SA and Cytosorbents Crp
Assuming the 90 days horizon Novacyt SA is expected to generate 1.27 times more return on investment than Cytosorbents Crp. However, Novacyt SA is 1.27 times more volatile than Cytosorbents Crp. It trades about 0.02 of its potential returns per unit of risk. Cytosorbents Crp is currently generating about 0.0 per unit of risk. If you would invest 82.00 in Novacyt SA on September 20, 2024 and sell it today you would lose (18.00) from holding Novacyt SA or give up 21.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
Novacyt SA vs. Cytosorbents Crp
Performance |
| Timeline |
| Novacyt SA |
| Cytosorbents Crp |
Novacyt SA and Cytosorbents Crp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Novacyt SA and Cytosorbents Crp
The main advantage of trading using opposite Novacyt SA and Cytosorbents Crp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Novacyt SA position performs unexpectedly, Cytosorbents Crp 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 Cytosorbents Crp will offset losses from the drop in Cytosorbents Crp's long position.| Novacyt SA vs. Abbott Laboratories | Novacyt SA vs. Stryker | Novacyt SA vs. Boston Scientific Corp | Novacyt SA vs. Medtronic PLC |
| Cytosorbents Crp vs. LivaNova PLC | Cytosorbents Crp vs. Electromed | Cytosorbents Crp vs. Orthopediatrics Corp | Cytosorbents Crp vs. SurModics |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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