Correlation Between Microbot Medical and Chester Mining

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

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

Diversification Opportunities for Microbot Medical and Chester Mining

0.0

Correlation Coefficient

Microbot Medical  Chester Mining

Pay attention - limited upside

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

Pair Corralation between Microbot Medical and Chester Mining

If you would invest  124.00  in Microbot Medical on October 2, 2024 and sell it today you would lose (14.00) from holding Microbot Medical or give up 11.29% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.56%
Values	Daily Returns

Microbot Medical  vs.  Chester Mining

Microbot Medical

Risk-Adjusted Performance

8 of 100

Good

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 fragile basic indicators, Microbot Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

Chester Mining

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chester Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, Chester Mining is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Microbot Medical and Chester Mining

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

The idea behind Microbot Medical and Chester Mining 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 Global Correlations module to find global opportunities by holding instruments from different markets.