Correlation Between Red Cat and Oxford Nanopore
Can any of the company-specific risk be diversified away by investing in both Red Cat and Oxford Nanopore 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 Red Cat and Oxford Nanopore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Cat Holdings and Oxford Nanopore Technologies, you can compare the effects of market volatilities on Red Cat and Oxford Nanopore 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 Red Cat with a short position of Oxford Nanopore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Cat and Oxford Nanopore.
Diversification Opportunities for Red Cat and Oxford Nanopore
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Red and Oxford is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Red Cat Holdings and Oxford Nanopore Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford Nanopore Tech and Red Cat 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 Red Cat Holdings are associated (or correlated) with Oxford Nanopore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford Nanopore Tech has no effect on the direction of Red Cat i.e., Red Cat and Oxford Nanopore go up and down completely randomly.
Pair Corralation between Red Cat and Oxford Nanopore
Given the investment horizon of 90 days Red Cat Holdings is expected to generate 2.11 times more return on investment than Oxford Nanopore. However, Red Cat is 2.11 times more volatile than Oxford Nanopore Technologies. It trades about 0.62 of its potential returns per unit of risk. Oxford Nanopore Technologies is currently generating about -0.15 per unit of risk. If you would invest 272.00 in Red Cat Holdings on August 25, 2024 and sell it today you would earn a total of 625.00 from holding Red Cat Holdings or generate 229.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Cat Holdings vs. Oxford Nanopore Technologies
Performance |
| Timeline |
| Red Cat Holdings |
| Oxford Nanopore Tech |
Red Cat and Oxford Nanopore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Cat and Oxford Nanopore
The main advantage of trading using opposite Red Cat and Oxford Nanopore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Cat position performs unexpectedly, Oxford Nanopore 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 Oxford Nanopore will offset losses from the drop in Oxford Nanopore's long position.| Red Cat vs. Quantum Computing | Red Cat vs. Rigetti Computing | Red Cat vs. D Wave Quantum | Red Cat vs. AstroNova |
| Oxford Nanopore vs. Lineage Cell Therapeutics | Oxford Nanopore vs. Cadrenal Therapeutics, Common | Oxford Nanopore vs. ImmuCell | Oxford Nanopore vs. Braxia Scientific Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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