Correlation Between Raketech Group and Neola Medical
Can any of the company-specific risk be diversified away by investing in both Raketech Group and Neola 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 Raketech Group and Neola Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raketech Group Holding and Neola Medical AB, you can compare the effects of market volatilities on Raketech Group and Neola 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 Raketech Group with a short position of Neola Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raketech Group and Neola Medical.
Diversification Opportunities for Raketech Group and Neola Medical
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Raketech and Neola is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Raketech Group Holding and Neola Medical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neola Medical AB and Raketech Group 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 Raketech Group Holding are associated (or correlated) with Neola Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neola Medical AB has no effect on the direction of Raketech Group i.e., Raketech Group and Neola Medical go up and down completely randomly.
Pair Corralation between Raketech Group and Neola Medical
Assuming the 90 days trading horizon Raketech Group Holding is expected to under-perform the Neola Medical. But the stock apears to be less risky and, when comparing its historical volatility, Raketech Group Holding is 2.05 times less risky than Neola Medical. The stock trades about -0.1 of its potential returns per unit of risk. The Neola Medical AB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 165.00 in Neola Medical AB on September 3, 2024 and sell it today you would earn a total of 55.00 from holding Neola Medical AB or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raketech Group Holding vs. Neola Medical AB
Performance |
| Timeline |
| Raketech Group Holding |
| Neola Medical AB |
Raketech Group and Neola Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raketech Group and Neola Medical
The main advantage of trading using opposite Raketech Group and Neola Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raketech Group position performs unexpectedly, Neola 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 Neola Medical will offset losses from the drop in Neola Medical's long position.| Raketech Group vs. Catena Media plc | Raketech Group vs. Better Collective | Raketech Group vs. Betsson AB | Raketech Group vs. Kambi Group PLC |
| Neola Medical vs. iZafe Group AB | Neola Medical vs. Triboron International AB | Neola Medical vs. KABE Group AB | Neola Medical vs. IAR Systems Group |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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