Correlation Between NeuPath Health and Wilmington Capital

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

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

Diversification Opportunities for NeuPath Health and Wilmington Capital

-0.74

Correlation Coefficient

NeuPath Health  Wilmington Capital

Pay attention - limited upside

The 3 months correlation between NeuPath and Wilmington is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding NeuPath Health and Wilmington Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmington Capital and NeuPath Health 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 NeuPath Health are associated (or correlated) with Wilmington Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmington Capital has no effect on the direction of NeuPath Health i.e., NeuPath Health and Wilmington Capital go up and down completely randomly.

Pair Corralation between NeuPath Health and Wilmington Capital

Assuming the 90 days trading horizon NeuPath Health is expected to generate 30.37 times more return on investment than Wilmington Capital. However, NeuPath Health is 30.37 times more volatile than Wilmington Capital Management. It trades about 0.02 of its potential returns per unit of risk. Wilmington Capital Management is currently generating about 0.0 per unit of risk. If you would invest  21.00  in NeuPath Health on October 11, 2024 and sell it today you would earn a total of  0.00  from holding NeuPath Health or generate 0.0% return on investment over 90 days.

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

NeuPath Health  vs.  Wilmington Capital Management

NeuPath Health

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NeuPath Health are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, NeuPath Health showed solid returns over the last few months and may actually be approaching a breakup point.

Wilmington Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wilmington Capital Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with NeuPath Health and Wilmington Capital

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

The idea behind NeuPath Health and Wilmington Capital Management 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 Global Correlations module to find global opportunities by holding instruments from different markets.