Correlation Between Sight Sciences and Novocure
Can any of the company-specific risk be diversified away by investing in both Sight Sciences and Novocure 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 Sight Sciences and Novocure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sight Sciences and Novocure, you can compare the effects of market volatilities on Sight Sciences and Novocure 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 Sight Sciences with a short position of Novocure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sight Sciences and Novocure.
Diversification Opportunities for Sight Sciences and Novocure
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sight and Novocure is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Sight Sciences and Novocure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Novocure and Sight Sciences 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 Sight Sciences are associated (or correlated) with Novocure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Novocure has no effect on the direction of Sight Sciences i.e., Sight Sciences and Novocure go up and down completely randomly.
Pair Corralation between Sight Sciences and Novocure
Given the investment horizon of 90 days Sight Sciences is expected to under-perform the Novocure. But the stock apears to be less risky and, when comparing its historical volatility, Sight Sciences is 4.04 times less risky than Novocure. The stock trades about -0.12 of its potential returns per unit of risk. The Novocure is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 1,782 in Novocure on September 13, 2024 and sell it today you would earn a total of 1,331 from holding Novocure or generate 74.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sight Sciences vs. Novocure
Performance |
| Timeline |
| Sight Sciences |
| Novocure |
Sight Sciences and Novocure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sight Sciences and Novocure
The main advantage of trading using opposite Sight Sciences and Novocure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sight Sciences position performs unexpectedly, Novocure 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 Novocure will offset losses from the drop in Novocure's long position.| Sight Sciences vs. Si Bone | Sight Sciences vs. Rapid Micro Biosystems | Sight Sciences vs. Tactile Systems Technology | Sight Sciences vs. Pulmonx Corp |
| Novocure vs. Avita Medical | Novocure vs. Sight Sciences | Novocure vs. Treace Medical Concepts | Novocure vs. Neuropace |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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