Correlation Between Eyenovia and Aptorum Group

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

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

Diversification Opportunities for Eyenovia and Aptorum Group

0.44

Correlation Coefficient

Eyenovia  Aptorum Group

Very weak diversification

The 3 months correlation between Eyenovia and Aptorum is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Eyenovia and Aptorum Group Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptorum Group and Eyenovia 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 Eyenovia are associated (or correlated) with Aptorum Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptorum Group has no effect on the direction of Eyenovia i.e., Eyenovia and Aptorum Group go up and down completely randomly.

Pair Corralation between Eyenovia and Aptorum Group

Given the investment horizon of 90 days Eyenovia is expected to under-perform the Aptorum Group. But the stock apears to be less risky and, when comparing its historical volatility, Eyenovia is 1.62 times less risky than Aptorum Group. The stock trades about -0.19 of its potential returns per unit of risk. The Aptorum Group Ltd is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  73.00  in Aptorum Group Ltd on December 21, 2024 and sell it today you would earn a total of  19.00  from holding Aptorum Group Ltd or generate 26.03% return on investment over 90 days.

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

Eyenovia  vs.  Aptorum Group Ltd

Eyenovia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eyenovia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Aptorum Group

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Aptorum Group Ltd are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Aptorum Group displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eyenovia and Aptorum Group

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

The idea behind Eyenovia and Aptorum Group Ltd 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.