Correlation Between Nyxoah and Nexgel

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

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

Diversification Opportunities for Nyxoah and Nexgel

-0.54

Correlation Coefficient

Nyxoah  Nexgel

Excellent diversification

The 3 months correlation between Nyxoah and Nexgel is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Nyxoah and Nexgel Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexgel Inc 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 Nexgel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexgel Inc has no effect on the direction of Nyxoah i.e., Nyxoah and Nexgel go up and down completely randomly.

Pair Corralation between Nyxoah and Nexgel

Given the investment horizon of 90 days Nyxoah is expected to under-perform the Nexgel. But the stock apears to be less risky and, when comparing its historical volatility, Nyxoah is 1.08 times less risky than Nexgel. The stock trades about -0.01 of its potential returns per unit of risk. The Nexgel Inc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  297.00  in Nexgel Inc on December 2, 2024 and sell it today you would earn a total of  13.00  from holding Nexgel Inc or generate 4.38% return on investment over 90 days.

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

Nyxoah  vs.  Nexgel Inc

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.

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.

Pair Trading with Nyxoah and Nexgel

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

The idea behind Nyxoah and Nexgel Inc 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.