Correlation Between MAIA Biotechnology and Nuvectis Pharma

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

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

Diversification Opportunities for MAIA Biotechnology and Nuvectis Pharma

-0.65

Correlation Coefficient

MAIA Biotechnology  Nuvectis Pharma

Excellent diversification

The 3 months correlation between MAIA and Nuvectis is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding MAIA Biotechnology and Nuvectis Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuvectis Pharma and MAIA Biotechnology 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 MAIA Biotechnology are associated (or correlated) with Nuvectis Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuvectis Pharma has no effect on the direction of MAIA Biotechnology i.e., MAIA Biotechnology and Nuvectis Pharma go up and down completely randomly.

Pair Corralation between MAIA Biotechnology and Nuvectis Pharma

Given the investment horizon of 90 days MAIA Biotechnology is expected to under-perform the Nuvectis Pharma. But the stock apears to be less risky and, when comparing its historical volatility, MAIA Biotechnology is 1.23 times less risky than Nuvectis Pharma. The stock trades about -0.05 of its potential returns per unit of risk. The Nuvectis Pharma is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  514.00  in Nuvectis Pharma on December 29, 2024 and sell it today you would earn a total of  451.00  from holding Nuvectis Pharma or generate 87.74% return on investment over 90 days.

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

MAIA Biotechnology  vs.  Nuvectis Pharma

MAIA Biotechnology

Risk-Adjusted Performance

Very Weak

Over the last 90 days MAIA Biotechnology 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 forward indicators 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.

Nuvectis Pharma

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nuvectis Pharma are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating fundamental indicators, Nuvectis Pharma unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MAIA Biotechnology and Nuvectis Pharma

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

The idea behind MAIA Biotechnology and Nuvectis Pharma 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.