Correlation Between MediciNova and Aditxt

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

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

Diversification Opportunities for MediciNova and Aditxt

0.63

Correlation Coefficient

MediciNova  Aditxt

Poor diversification

The 3 months correlation between MediciNova and Aditxt is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding MediciNova and Aditxt Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aditxt Inc and MediciNova 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 MediciNova are associated (or correlated) with Aditxt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aditxt Inc has no effect on the direction of MediciNova i.e., MediciNova and Aditxt go up and down completely randomly.

Pair Corralation between MediciNova and Aditxt

Given the investment horizon of 90 days MediciNova is expected to generate 0.31 times more return on investment than Aditxt. However, MediciNova is 3.25 times less risky than Aditxt. It trades about -0.05 of its potential returns per unit of risk. Aditxt Inc is currently generating about -0.18 per unit of risk. If you would invest  201.00  in MediciNova on November 27, 2024 and sell it today you would lose (27.00) from holding MediciNova or give up 13.43% of portfolio value over 90 days.

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

MediciNova  vs.  Aditxt Inc

MediciNova

Risk-Adjusted Performance

Very Weak

Over the last 90 days MediciNova has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Aditxt Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aditxt Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with MediciNova and Aditxt

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

The idea behind MediciNova and Aditxt Inc 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.