Correlation Between Nanobiotix and OSE Pharma

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

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

Diversification Opportunities for Nanobiotix and OSE Pharma

-0.3

Correlation Coefficient

Nanobiotix  OSE Pharma

Very good diversification

The 3 months correlation between Nanobiotix and OSE is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Nanobiotix SA and OSE Pharma SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OSE Pharma SA and Nanobiotix 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 Nanobiotix SA are associated (or correlated) with OSE Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OSE Pharma SA has no effect on the direction of Nanobiotix i.e., Nanobiotix and OSE Pharma go up and down completely randomly.

Pair Corralation between Nanobiotix and OSE Pharma

Assuming the 90 days trading horizon Nanobiotix is expected to generate 2.41 times less return on investment than OSE Pharma. In addition to that, Nanobiotix is 1.29 times more volatile than OSE Pharma SA. It trades about 0.02 of its total potential returns per unit of risk. OSE Pharma SA is currently generating about 0.07 per unit of volatility. If you would invest  637.00  in OSE Pharma SA on December 4, 2024 and sell it today you would earn a total of  22.00  from holding OSE Pharma SA or generate 3.45% return on investment over 90 days.

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

Nanobiotix SA  vs.  OSE Pharma SA

Nanobiotix SA

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nanobiotix SA are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Nanobiotix sustained solid returns over the last few months and may actually be approaching a breakup point.

OSE Pharma SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days OSE Pharma SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Nanobiotix and OSE Pharma

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

The idea behind Nanobiotix SA and OSE Pharma SA 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.