Correlation Between Electrocore LLC and Neuroone Medical

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

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

Diversification Opportunities for Electrocore LLC and Neuroone Medical

0.15

Correlation Coefficient

Electrocore LLC  Neuroone Medical

Average diversification

The 3 months correlation between Electrocore and Neuroone is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Electrocore LLC and Neuroone Medical Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neuroone Medical Tec and Electrocore LLC 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 LLC are associated (or correlated) with Neuroone Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neuroone Medical Tec has no effect on the direction of Electrocore LLC i.e., Electrocore LLC and Neuroone Medical go up and down completely randomly.

Pair Corralation between Electrocore LLC and Neuroone Medical

Given the investment horizon of 90 days Electrocore LLC is expected to under-perform the Neuroone Medical. But the stock apears to be less risky and, when comparing its historical volatility, Electrocore LLC is 1.03 times less risky than Neuroone Medical. The stock trades about -0.22 of its potential returns per unit of risk. The Neuroone Medical Technologies is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  74.00  in Neuroone Medical Technologies on December 23, 2024 and sell it today you would earn a total of  29.00  from holding Neuroone Medical Technologies or generate 39.19% return on investment over 90 days.

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

Electrocore LLC  vs.  Neuroone Medical Technologies

Electrocore LLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Electrocore LLC has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Neuroone Medical Tec

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Neuroone Medical Technologies are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Neuroone Medical exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Electrocore LLC and Neuroone Medical

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

The idea behind Electrocore LLC and Neuroone Medical Technologies 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 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.