Correlation Between Nyxoah and Emerson Electric
Can any of the company-specific risk be diversified away by investing in both Nyxoah and Emerson Electric 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 Nyxoah and Emerson Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nyxoah and Emerson Electric, you can compare the effects of market volatilities on Nyxoah and Emerson Electric 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 Nyxoah with a short position of Emerson Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nyxoah and Emerson Electric.
Diversification Opportunities for Nyxoah and Emerson Electric
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Nyxoah and Emerson is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Nyxoah and Emerson Electric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerson Electric and Nyxoah 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 Nyxoah are associated (or correlated) with Emerson Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerson Electric has no effect on the direction of Nyxoah i.e., Nyxoah and Emerson Electric go up and down completely randomly.
Pair Corralation between Nyxoah and Emerson Electric
Given the investment horizon of 90 days Nyxoah is expected to under-perform the Emerson Electric. But the stock apears to be less risky and, when comparing its historical volatility, Nyxoah is 1.02 times less risky than Emerson Electric. The stock trades about -0.34 of its potential returns per unit of risk. The Emerson Electric is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 10,782 in Emerson Electric on August 25, 2024 and sell it today you would earn a total of 2,225 from holding Emerson Electric or generate 20.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nyxoah vs. Emerson Electric
Performance |
| Timeline |
| Nyxoah |
| Emerson Electric |
Nyxoah and Emerson Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nyxoah and Emerson Electric
The main advantage of trading using opposite Nyxoah and Emerson Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nyxoah position performs unexpectedly, Emerson Electric 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 Emerson Electric will offset losses from the drop in Emerson Electric's long position.| Nyxoah vs. Heartbeam | Nyxoah vs. EUDA Health Holdings | Nyxoah vs. Nutex Health | Nyxoah vs. Healthcare Triangle |
| Emerson Electric vs. Graco Inc | Emerson Electric vs. Franklin Electric Co | Emerson Electric vs. Flowserve | Emerson Electric vs. Donaldson |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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