Correlation Between Global E and Nyxoah

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

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

Diversification Opportunities for Global E and Nyxoah

-0.91

Correlation Coefficient

Global E  Nyxoah

Pay attention - limited upside

The 3 months correlation between Global and Nyxoah is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Global E Online and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and Global E 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 Global E Online 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 Global E i.e., Global E and Nyxoah go up and down completely randomly.

Pair Corralation between Global E and Nyxoah

Given the investment horizon of 90 days Global E Online is expected to generate 0.92 times more return on investment than Nyxoah. However, Global E Online is 1.08 times less risky than Nyxoah. It trades about 0.13 of its potential returns per unit of risk. Nyxoah is currently generating about 0.01 per unit of risk. If you would invest  5,235  in Global E Online on October 3, 2024 and sell it today you would earn a total of  218.00  from holding Global E Online or generate 4.16% return on investment over 90 days.

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

Global E Online  vs.  Nyxoah

Global E Online

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Global E Online are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental drivers, Global E exhibited solid returns over the last few months and may actually be approaching a breakup point.

Nyxoah

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nyxoah has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Global E and Nyxoah

The main advantage of trading using opposite Global E and Nyxoah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global E 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 Global E Online 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.

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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.