Correlation Between Nyxoah and ICU Medical
Can any of the company-specific risk be diversified away by investing in both Nyxoah and ICU Medical 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 ICU Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nyxoah and ICU Medical, you can compare the effects of market volatilities on Nyxoah and ICU Medical 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 ICU Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nyxoah and ICU Medical.
Diversification Opportunities for Nyxoah and ICU Medical
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nyxoah and ICU is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Nyxoah and ICU Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICU Medical 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 ICU Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICU Medical has no effect on the direction of Nyxoah i.e., Nyxoah and ICU Medical go up and down completely randomly.
Pair Corralation between Nyxoah and ICU Medical
Given the investment horizon of 90 days Nyxoah is expected to under-perform the ICU Medical. In addition to that, Nyxoah is 1.22 times more volatile than ICU Medical. It trades about -0.01 of its total potential returns per unit of risk. ICU Medical is currently generating about 0.12 per unit of volatility. If you would invest 10,634 in ICU Medical on August 29, 2024 and sell it today you would earn a total of 5,341 from holding ICU Medical or generate 50.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nyxoah vs. ICU Medical
Performance |
| Timeline |
| Nyxoah |
| ICU Medical |
Nyxoah and ICU Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nyxoah and ICU Medical
The main advantage of trading using opposite Nyxoah and ICU Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nyxoah position performs unexpectedly, ICU Medical 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 ICU Medical will offset losses from the drop in ICU Medical's long position.The idea behind Nyxoah and ICU Medical pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| ICU Medical vs. Femasys | ICU Medical vs. Sharps Technology Warrant | ICU Medical vs. GlucoTrack | ICU Medical vs. Walt Disney |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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