Correlation Between Nexgel and Alcon AG
Can any of the company-specific risk be diversified away by investing in both Nexgel and Alcon AG 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 Nexgel and Alcon AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexgel Inc and Alcon AG, you can compare the effects of market volatilities on Nexgel and Alcon AG 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 Nexgel with a short position of Alcon AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexgel and Alcon AG.
Diversification Opportunities for Nexgel and Alcon AG
Pay attention - limited upside
The 3 months correlation between Nexgel and Alcon is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Nexgel Inc and Alcon AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alcon AG and Nexgel 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 Nexgel Inc are associated (or correlated) with Alcon AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcon AG has no effect on the direction of Nexgel i.e., Nexgel and Alcon AG go up and down completely randomly.
Pair Corralation between Nexgel and Alcon AG
Given the investment horizon of 90 days Nexgel Inc is expected to generate 3.11 times more return on investment than Alcon AG. However, Nexgel is 3.11 times more volatile than Alcon AG. It trades about 0.16 of its potential returns per unit of risk. Alcon AG is currently generating about -0.3 per unit of risk. If you would invest 295.00 in Nexgel Inc on August 27, 2024 and sell it today you would earn a total of 42.00 from holding Nexgel Inc or generate 14.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nexgel Inc vs. Alcon AG
Performance |
| Timeline |
| Nexgel Inc |
| Alcon AG |
Nexgel and Alcon AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexgel and Alcon AG
The main advantage of trading using opposite Nexgel and Alcon AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexgel position performs unexpectedly, Alcon AG 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 Alcon AG will offset losses from the drop in Alcon AG's long position.| Nexgel vs. Heartbeam | Nexgel vs. EUDA Health Holdings | Nexgel vs. Nutex Health | Nexgel vs. Healthcare Triangle |
| Alcon AG vs. Heartbeam | Alcon AG vs. EUDA Health Holdings | Alcon AG vs. Nutex Health | Alcon AG 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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