Correlation Between Microbot Medical and Eldorado Gold

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

By analyzing existing cross correlation between Microbot Medical and Eldorado Gold Corp, you can compare the effects of market volatilities on Microbot Medical and Eldorado Gold 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 Eldorado Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microbot Medical and Eldorado Gold.

Diversification Opportunities for Microbot Medical and Eldorado Gold

-0.34

Correlation Coefficient

Microbot Medical  Eldorado Gold

Very good diversification

The 3 months correlation between Microbot and Eldorado is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and Eldorado Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eldorado Gold Corp 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 Eldorado Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eldorado Gold Corp has no effect on the direction of Microbot Medical i.e., Microbot Medical and Eldorado Gold go up and down completely randomly.

Pair Corralation between Microbot Medical and Eldorado Gold

Given the investment horizon of 90 days Microbot Medical is expected to generate 5.07 times more return on investment than Eldorado Gold. However, Microbot Medical is 5.07 times more volatile than Eldorado Gold Corp. It trades about 0.11 of its potential returns per unit of risk. Eldorado Gold Corp is currently generating about -0.14 per unit of risk. If you would invest  100.00  in Microbot Medical on October 20, 2024 and sell it today you would earn a total of  64.00  from holding Microbot Medical or generate 64.0% return on investment over 90 days.

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

Microbot Medical  vs.  Eldorado Gold Corp

Microbot Medical

Risk-Adjusted Performance

8 of 100

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.

Eldorado Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eldorado Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Microbot Medical and Eldorado Gold

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

The idea behind Microbot Medical and Eldorado Gold Corp 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 Commodity Directory module to find actively traded commodities issued by global exchanges.