Correlation Between Nexgel and Nyxoah

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

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

Diversification Opportunities for Nexgel and Nyxoah

-0.54

Correlation Coefficient

Nexgel  Nyxoah

Excellent diversification

The 3 months correlation between Nexgel and Nyxoah is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Nexgel Inc and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and Nexgel 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 Nexgel Inc 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 Nexgel i.e., Nexgel and Nyxoah go up and down completely randomly.

Pair Corralation between Nexgel and Nyxoah

Given the investment horizon of 90 days Nexgel Inc is expected to under-perform the Nyxoah. In addition to that, Nexgel is 2.32 times more volatile than Nyxoah. It trades about -0.27 of its total potential returns per unit of risk. Nyxoah is currently generating about -0.22 per unit of volatility. If you would invest  1,080  in Nyxoah on December 2, 2024 and sell it today you would lose (76.00) from holding Nyxoah or give up 7.04% of portfolio value over 90 days.

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

Nexgel Inc  vs.  Nyxoah

Nexgel Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nexgel Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent technical and fundamental indicators, Nexgel is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Nyxoah

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nyxoah are ranked lower than 10 (%) 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 Nexgel and Nyxoah

The main advantage of trading using opposite Nexgel and Nyxoah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nexgel 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 Nexgel Inc 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.

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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.