Correlation Between Hertz Global and Nyxoah

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

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

Diversification Opportunities for Hertz Global and Nyxoah

-0.48

Correlation Coefficient

Hertz Global  Nyxoah

Very good diversification

The 3 months correlation between Hertz and Nyxoah is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Hldgs and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and Hertz Global 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 Hertz Global Hldgs 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 Hertz Global i.e., Hertz Global and Nyxoah go up and down completely randomly.

Pair Corralation between Hertz Global and Nyxoah

Assuming the 90 days horizon Hertz Global Hldgs is expected to under-perform the Nyxoah. In addition to that, Hertz Global is 1.23 times more volatile than Nyxoah. It trades about -0.06 of its total potential returns per unit of risk. Nyxoah is currently generating about 0.19 per unit of volatility. If you would invest  820.00  in Nyxoah on October 25, 2024 and sell it today you would earn a total of  219.00  from holding Nyxoah or generate 26.71% return on investment over 90 days.

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

Hertz Global Hldgs  vs.  Nyxoah

Hertz Global Hldgs

Risk-Adjusted Performance

6 of 100

Modest

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

Nyxoah

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Nyxoah are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Nyxoah may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Hertz Global and Nyxoah

The main advantage of trading using opposite Hertz Global and Nyxoah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global 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 Hertz Global Hldgs 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.