Correlation Between Nexalin Technology and Lifeline Biotechnologies
Can any of the company-specific risk be diversified away by investing in both Nexalin Technology and Lifeline Biotechnologies 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 Nexalin Technology and Lifeline Biotechnologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexalin Technology and Lifeline Biotechnologies, you can compare the effects of market volatilities on Nexalin Technology and Lifeline Biotechnologies 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 Nexalin Technology with a short position of Lifeline Biotechnologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexalin Technology and Lifeline Biotechnologies.
Diversification Opportunities for Nexalin Technology and Lifeline Biotechnologies
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nexalin and Lifeline is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Nexalin Technology and Lifeline Biotechnologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifeline Biotechnologies and Nexalin Technology 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 Nexalin Technology are associated (or correlated) with Lifeline Biotechnologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifeline Biotechnologies has no effect on the direction of Nexalin Technology i.e., Nexalin Technology and Lifeline Biotechnologies go up and down completely randomly.
Pair Corralation between Nexalin Technology and Lifeline Biotechnologies
Considering the 90-day investment horizon Nexalin Technology is expected to generate 19.35 times less return on investment than Lifeline Biotechnologies. But when comparing it to its historical volatility, Nexalin Technology is 8.17 times less risky than Lifeline Biotechnologies. It trades about 0.07 of its potential returns per unit of risk. Lifeline Biotechnologies is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Lifeline Biotechnologies on October 12, 2024 and sell it today you would earn a total of 0.02 from holding Lifeline Biotechnologies or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.58% |
| Values | Daily Returns |
Nexalin Technology vs. Lifeline Biotechnologies
Performance |
| Timeline |
| Nexalin Technology |
| Lifeline Biotechnologies |
Nexalin Technology and Lifeline Biotechnologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexalin Technology and Lifeline Biotechnologies
The main advantage of trading using opposite Nexalin Technology and Lifeline Biotechnologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexalin Technology position performs unexpectedly, Lifeline Biotechnologies 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 Lifeline Biotechnologies will offset losses from the drop in Lifeline Biotechnologies' long position.| Nexalin Technology vs. Ainos Inc | Nexalin Technology vs. Electromed | Nexalin Technology vs. Armm Inc | Nexalin Technology vs. SurModics |
| Lifeline Biotechnologies vs. Modular Medical | Lifeline Biotechnologies vs. Neuropace | Lifeline Biotechnologies vs. Nexalin Technology | Lifeline Biotechnologies vs. STRATA Skin Sciences |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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