Correlation Between Microbot Medical and Here Media

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

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

Diversification Opportunities for Microbot Medical and Here Media

0.0

Correlation Coefficient

Microbot Medical  Here Media

Pay attention - limited upside

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

Pair Corralation between Microbot Medical and Here Media

Given the investment horizon of 90 days Microbot Medical is expected to generate 4.02 times less return on investment than Here Media. In addition to that, Microbot Medical is 2.04 times more volatile than Here Media. It trades about 0.01 of its total potential returns per unit of risk. Here Media is currently generating about 0.04 per unit of volatility. If you would invest  0.01  in Here Media on October 4, 2024 and sell it today you would earn a total of  0.01  from holding Here Media or generate 100.0% return on investment over 90 days.

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

Microbot Medical  vs.  Here Media

Microbot Medical

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 9 (%) 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.

Here Media

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Here Media has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward indicators, Here Media is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Microbot Medical and Here Media

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

The idea behind Microbot Medical and Here Media 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.