Correlation Between National CineMedia and Nyxoah

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

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

Diversification Opportunities for National CineMedia and Nyxoah

-0.29

Correlation Coefficient

National CineMedia  Nyxoah

Very good diversification

The 3 months correlation between National and Nyxoah is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and National CineMedia 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 National CineMedia are associated (or correlated) with Nyxoah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nyxoah has no effect on the direction of National CineMedia i.e., National CineMedia and Nyxoah go up and down completely randomly.

Pair Corralation between National CineMedia and Nyxoah

Given the investment horizon of 90 days National CineMedia is expected to generate 9.99 times less return on investment than Nyxoah. But when comparing it to its historical volatility, National CineMedia is 1.56 times less risky than Nyxoah. It trades about 0.06 of its potential returns per unit of risk. Nyxoah is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest  800.00  in Nyxoah on October 26, 2024 and sell it today you would earn a total of  268.00  from holding Nyxoah or generate 33.5% return on investment over 90 days.

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

National CineMedia  vs.  Nyxoah

National CineMedia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days National CineMedia has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong primary indicators, National CineMedia is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Nyxoah

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Nyxoah are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Nyxoah demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with National CineMedia and Nyxoah

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

The idea behind National CineMedia and Nyxoah 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.