Correlation Between Electrocore and Alcon

By analyzing existing cross correlation between Electrocore and Alcon Inc, you can compare the effects of market volatilities on Electrocore and Alcon 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 Electrocore with a short position of Alcon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electrocore and Alcon.

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Can any of the company-specific risk be diversified away by investing in both Electrocore and Alcon 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 Electrocore and Alcon into the same portfolio, which is an essential part of the fundamental portfolio management process.

Diversification Opportunities for Electrocore and Alcon

0.04
  Correlation Coefficient
Electrocore
Alcon Inc

Significant diversification

The 3 months correlation between Electrocore and Alcon is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Electrocore and Alcon Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Alcon Inc and Electrocore 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 Electrocore are associated (or correlated) with Alcon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alcon Inc has no effect on the direction of Electrocore i.e., Electrocore and Alcon go up and down completely randomly.

Pair Corralation between Electrocore and Alcon

Given the investment horizon of 90 days Electrocore is expected to under-perform the Alcon. In addition to that, Electrocore is 2.03 times more volatile than Alcon Inc. It trades about -0.33 of its total potential returns per unit of risk. Alcon Inc is currently generating about -0.21 per unit of volatility. If you would invest  8,440  in Alcon Inc on September 1, 2021 and sell it today you would lose (591.00)  from holding Alcon Inc or give up 7.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Electrocore  vs.  Alcon Inc

 Performance (%) 
      Timeline 
Electrocore 
Electrocore Performance
0 of 100
Over the last 90 days Electrocore has generated negative risk-adjusted returns adding no value to investors with long positions. Even with sluggish performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in December 2021. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Electrocore Price Channel

Alcon Inc 
Alcon Performance
0 of 100
Over the last 90 days Alcon Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong essential indicators, Alcon is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Alcon Price Channel

Electrocore and Alcon Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Electrocore and Alcon

The main advantage of trading using opposite Electrocore and Alcon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electrocore position performs unexpectedly, Alcon 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 Alcon will offset losses from the drop in Alcon's long position.
The idea behind Electrocore and Alcon Inc 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.

Alcon Inc

Pair trading matchups for Alcon

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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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