Correlation Between Microbot Medical and PKSHA TECHNOLOGY

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

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

Diversification Opportunities for Microbot Medical and PKSHA TECHNOLOGY

-0.01

Correlation Coefficient

Microbot Medical  PKSHA TECHNOLOGY

Good diversification

The 3 months correlation between Microbot and PKSHA is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and PKSHA TECHNOLOGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PKSHA TECHNOLOGY INC and Microbot Medical 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 Microbot Medical are associated (or correlated) with PKSHA TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PKSHA TECHNOLOGY INC has no effect on the direction of Microbot Medical i.e., Microbot Medical and PKSHA TECHNOLOGY go up and down completely randomly.

Pair Corralation between Microbot Medical and PKSHA TECHNOLOGY

Assuming the 90 days trading horizon Microbot Medical is expected to generate 3.55 times more return on investment than PKSHA TECHNOLOGY. However, Microbot Medical is 3.55 times more volatile than PKSHA TECHNOLOGY INC. It trades about 0.03 of its potential returns per unit of risk. PKSHA TECHNOLOGY INC is currently generating about 0.04 per unit of risk. If you would invest  275.00  in Microbot Medical on October 23, 2024 and sell it today you would lose (119.00) from holding Microbot Medical or give up 43.27% of portfolio value over 90 days.

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

Microbot Medical  vs.  PKSHA TECHNOLOGY INC

Microbot Medical

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Microbot Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

PKSHA TECHNOLOGY INC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PKSHA TECHNOLOGY INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, PKSHA TECHNOLOGY is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Microbot Medical and PKSHA TECHNOLOGY

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

The idea behind Microbot Medical and PKSHA TECHNOLOGY 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.

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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.