Correlation Between Empire State and Nyxoah

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

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

Diversification Opportunities for Empire State and Nyxoah

0.3

Correlation Coefficient

Empire State  Nyxoah

Weak diversification

The 3 months correlation between Empire and Nyxoah is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Empire State Realty and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and Empire State 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 Empire State Realty are associated (or correlated) with Nyxoah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nyxoah has no effect on the direction of Empire State i.e., Empire State and Nyxoah go up and down completely randomly.

Pair Corralation between Empire State and Nyxoah

Given the investment horizon of 90 days Empire State Realty is expected to under-perform the Nyxoah. But the stock apears to be less risky and, when comparing its historical volatility, Empire State Realty is 1.32 times less risky than Nyxoah. The stock trades about -0.15 of its potential returns per unit of risk. The Nyxoah is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  800.00  in Nyxoah on December 21, 2024 and sell it today you would earn a total of  347.00  from holding Nyxoah or generate 43.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	91.67%
Values	Daily Returns

Empire State Realty  vs.  Nyxoah

Empire State Realty

Risk-Adjusted Performance

Very Weak

Over the last 90 days Empire State Realty has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Nyxoah

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nyxoah are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Nyxoah demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Empire State and Nyxoah

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

The idea behind Empire State Realty and Nyxoah 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.

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 the Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.