Correlation Between 23Andme Holding and Microbot Medical

Can any of the company-specific risk be diversified away by investing in both 23Andme Holding and Microbot 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 23Andme Holding and Microbot Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 23Andme Holding Co and Microbot Medical, you can compare the effects of market volatilities on 23Andme Holding and Microbot 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 23Andme Holding with a short position of Microbot Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of 23Andme Holding and Microbot Medical.

Diversification Opportunities for 23Andme Holding and Microbot Medical

0.59

Correlation Coefficient

23Andme Holding  Microbot Medical

Very weak diversification

The 3 months correlation between 23Andme and Microbot is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding 23Andme Holding Co and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical and 23Andme Holding 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 23Andme Holding Co are associated (or correlated) with Microbot Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbot Medical has no effect on the direction of 23Andme Holding i.e., 23Andme Holding and Microbot Medical go up and down completely randomly.

Pair Corralation between 23Andme Holding and Microbot Medical

Allowing for the 90-day total investment horizon 23Andme Holding Co is expected to generate 2.45 times more return on investment than Microbot Medical. However, 23Andme Holding is 2.45 times more volatile than Microbot Medical. It trades about 0.06 of its potential returns per unit of risk. Microbot Medical is currently generating about -0.28 per unit of risk. If you would invest  45.00  in 23Andme Holding Co on January 25, 2024 and sell it today you would earn a total of  1.71  from holding 23Andme Holding Co or generate 3.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

23Andme Holding Co  vs.  Microbot Medical

23Andme Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 23Andme Holding Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in May 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Microbot Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Microbot Medical has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with 23Andme Holding and Microbot Medical

The main advantage of trading using opposite 23Andme Holding and Microbot Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 23Andme Holding position performs unexpectedly, Microbot 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 Microbot Medical will offset losses from the drop in Microbot Medical's long position.

The idea behind 23Andme Holding Co and Microbot Medical 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.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.