Correlation Between Check Cap and Fonar

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

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

Diversification Opportunities for Check Cap and Fonar

0.29

Correlation Coefficient

Check Cap  Fonar

Modest diversification

The 3 months correlation between Check and Fonar is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Check Cap and Fonar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fonar and Check Cap 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 Check Cap are associated (or correlated) with Fonar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fonar has no effect on the direction of Check Cap i.e., Check Cap and Fonar go up and down completely randomly.

Pair Corralation between Check Cap and Fonar

Given the investment horizon of 90 days Check Cap is expected to generate 6.15 times more return on investment than Fonar. However, Check Cap is 6.15 times more volatile than Fonar. It trades about 0.0 of its potential returns per unit of risk. Fonar is currently generating about -0.05 per unit of risk. If you would invest  115.00  in Check Cap on December 28, 2024 and sell it today you would lose (31.00) from holding Check Cap or give up 26.96% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Check Cap  vs.  Fonar

Check Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Check Cap has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Check Cap is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Fonar

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fonar has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Fonar is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Check Cap and Fonar

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

The idea behind Check Cap and Fonar 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.