Correlation Between Nexgel and Predictive Oncology

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

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

Diversification Opportunities for Nexgel and Predictive Oncology

-0.37

Correlation Coefficient

Nexgel  Predictive Oncology

Very good diversification

The 3 months correlation between Nexgel and Predictive is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Nexgel Inc and Predictive Oncology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Predictive Oncology 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 Predictive Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Predictive Oncology has no effect on the direction of Nexgel i.e., Nexgel and Predictive Oncology go up and down completely randomly.

Pair Corralation between Nexgel and Predictive Oncology

Given the investment horizon of 90 days Nexgel Inc is expected to under-perform the Predictive Oncology. But the stock apears to be less risky and, when comparing its historical volatility, Nexgel Inc is 2.76 times less risky than Predictive Oncology. The stock trades about -0.14 of its potential returns per unit of risk. The Predictive Oncology is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  90.00  in Predictive Oncology on December 30, 2024 and sell it today you would earn a total of  55.00  from holding Predictive Oncology or generate 61.11% return on investment over 90 days.

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

Nexgel Inc  vs.  Predictive Oncology

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 conflicting performance in the last few months, the Stock's technical and fundamental 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.

Predictive Oncology

Risk-Adjusted Performance

OK

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

Pair Trading with Nexgel and Predictive Oncology

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

The idea behind Nexgel Inc and Predictive Oncology 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.