Correlation Between Nyxoah and InspireMD

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

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

Diversification Opportunities for Nyxoah and InspireMD

-0.78

Correlation Coefficient

Nyxoah  InspireMD

Pay attention - limited upside

The 3 months correlation between Nyxoah and InspireMD is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Nyxoah and InspireMD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InspireMD and Nyxoah 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 Nyxoah are associated (or correlated) with InspireMD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InspireMD has no effect on the direction of Nyxoah i.e., Nyxoah and InspireMD go up and down completely randomly.

Pair Corralation between Nyxoah and InspireMD

Given the investment horizon of 90 days Nyxoah is expected to generate 6.43 times less return on investment than InspireMD. But when comparing it to its historical volatility, Nyxoah is 1.2 times less risky than InspireMD. It trades about 0.0 of its potential returns per unit of risk. InspireMD is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  274.00  in InspireMD on October 7, 2024 and sell it today you would lose (3.00) from holding InspireMD or give up 1.09% of portfolio value over 90 days.

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

Nyxoah  vs.  InspireMD

Nyxoah

Risk-Adjusted Performance

0 of 100

Very Weak

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

InspireMD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days InspireMD has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, InspireMD is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Nyxoah and InspireMD

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

The idea behind Nyxoah and InspireMD 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.