Correlation Between Lava Medtech and Microbot Medical

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

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

Diversification Opportunities for Lava Medtech and Microbot Medical

0.0

Correlation Coefficient

Lava Medtech  Microbot Medical

Pay attention - limited upside

The 3 months correlation between Lava and Microbot is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lava Medtech Acquisition and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical and Lava Medtech 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 Lava Medtech Acquisition are associated (or correlated) with Microbot Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbot Medical has no effect on the direction of Lava Medtech i.e., Lava Medtech and Microbot Medical go up and down completely randomly.

Pair Corralation between Lava Medtech and Microbot Medical

If you would invest  100.00  in Microbot Medical on December 26, 2024 and sell it today you would earn a total of  59.00  from holding Microbot Medical or generate 59.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Lava Medtech Acquisition  vs.  Microbot Medical

Lava Medtech Acquisition

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lava Medtech Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, Lava Medtech is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Microbot Medical

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Microbot Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lava Medtech and Microbot Medical

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

The idea behind Lava Medtech Acquisition and Microbot Medical 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.