Correlation Between Nextage Therapeutics and Electra
Can any of the company-specific risk be diversified away by investing in both Nextage Therapeutics and Electra 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 Nextage Therapeutics and Electra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextage Therapeutics and Electra, you can compare the effects of market volatilities on Nextage Therapeutics and Electra 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 Nextage Therapeutics with a short position of Electra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextage Therapeutics and Electra.
Diversification Opportunities for Nextage Therapeutics and Electra
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nextage and Electra is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Nextage Therapeutics and Electra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electra and Nextage Therapeutics 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 Nextage Therapeutics are associated (or correlated) with Electra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electra has no effect on the direction of Nextage Therapeutics i.e., Nextage Therapeutics and Electra go up and down completely randomly.
Pair Corralation between Nextage Therapeutics and Electra
Assuming the 90 days trading horizon Nextage Therapeutics is expected to generate 7.5 times more return on investment than Electra. However, Nextage Therapeutics is 7.5 times more volatile than Electra. It trades about 0.32 of its potential returns per unit of risk. Electra is currently generating about -0.35 per unit of risk. If you would invest 3,700 in Nextage Therapeutics on January 25, 2024 and sell it today you would earn a total of 3,490 from holding Nextage Therapeutics or generate 94.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Nextage Therapeutics vs. Electra
Performance |
| Timeline |
| Nextage Therapeutics |
| Electra |
Nextage Therapeutics and Electra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nextage Therapeutics and Electra
The main advantage of trading using opposite Nextage Therapeutics and Electra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextage Therapeutics position performs unexpectedly, Electra 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 Electra will offset losses from the drop in Electra's long position.| Nextage Therapeutics vs. Bonus Biogroup | Nextage Therapeutics vs. Compugen | Nextage Therapeutics vs. Matricelf |
| Electra vs. Alony Hetz Properties | Electra vs. Melisron | Electra vs. Shufersal | Electra vs. Israel Discount Bank |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |