Correlation Between Nexalin Technology and LENSAR
Can any of the company-specific risk be diversified away by investing in both Nexalin Technology and LENSAR 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 LENSAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nexalin Technology and LENSAR Inc, you can compare the effects of market volatilities on Nexalin Technology and LENSAR 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 LENSAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nexalin Technology and LENSAR.
Diversification Opportunities for Nexalin Technology and LENSAR
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Nexalin and LENSAR is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Nexalin Technology and LENSAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LENSAR Inc 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 LENSAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LENSAR Inc has no effect on the direction of Nexalin Technology i.e., Nexalin Technology and LENSAR go up and down completely randomly.
Pair Corralation between Nexalin Technology and LENSAR
Considering the 90-day investment horizon Nexalin Technology is expected to generate 2.77 times more return on investment than LENSAR. However, Nexalin Technology is 2.77 times more volatile than LENSAR Inc. It trades about 0.36 of its potential returns per unit of risk. LENSAR Inc is currently generating about 0.25 per unit of risk. If you would invest 67.00 in Nexalin Technology on August 31, 2024 and sell it today you would earn a total of 360.00 from holding Nexalin Technology or generate 537.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nexalin Technology vs. LENSAR Inc
Performance |
| Timeline |
| Nexalin Technology |
| LENSAR Inc |
Nexalin Technology and LENSAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nexalin Technology and LENSAR
The main advantage of trading using opposite Nexalin Technology and LENSAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexalin Technology position performs unexpectedly, LENSAR 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 LENSAR will offset losses from the drop in LENSAR's long position.| Nexalin Technology vs. Electromed | Nexalin Technology vs. Armm Inc | Nexalin Technology vs. SurModics | Nexalin Technology vs. Bluejay Diagnostics |
| LENSAR vs. Abbott Laboratories | LENSAR vs. Medtronic PLC | LENSAR vs. Edwards Lifesciences Corp | LENSAR vs. ZimVie Inc |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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