Correlation Between Nuvectis Pharma and Replimune

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

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

Diversification Opportunities for Nuvectis Pharma and Replimune

-0.17

Correlation Coefficient

Nuvectis Pharma  Replimune

Good diversification

The 3 months correlation between Nuvectis and Replimune is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Nuvectis Pharma and Replimune Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Replimune Group and Nuvectis Pharma 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 Nuvectis Pharma are associated (or correlated) with Replimune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Replimune Group has no effect on the direction of Nuvectis Pharma i.e., Nuvectis Pharma and Replimune go up and down completely randomly.

Pair Corralation between Nuvectis Pharma and Replimune

Given the investment horizon of 90 days Nuvectis Pharma is expected to generate 1.44 times more return on investment than Replimune. However, Nuvectis Pharma is 1.44 times more volatile than Replimune Group. It trades about 0.23 of its potential returns per unit of risk. Replimune Group is currently generating about -0.05 per unit of risk. If you would invest  514.00  in Nuvectis Pharma on December 30, 2024 and sell it today you would earn a total of  532.00  from holding Nuvectis Pharma or generate 103.5% return on investment over 90 days.

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

Nuvectis Pharma  vs.  Replimune Group

Nuvectis Pharma

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nuvectis Pharma are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating fundamental indicators, Nuvectis Pharma unveiled solid returns over the last few months and may actually be approaching a breakup point.

Replimune Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Replimune Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Nuvectis Pharma and Replimune

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

The idea behind Nuvectis Pharma and Replimune Group 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.