Correlation Between AETNA and Nyxoah

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

By analyzing existing cross correlation between AETNA INC 7625 and Nyxoah, you can compare the effects of market volatilities on AETNA 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 AETNA with a short position of Nyxoah. Check out your portfolio center. Please also check ongoing floating volatility patterns of AETNA and Nyxoah.

Diversification Opportunities for AETNA and Nyxoah

0.49

Correlation Coefficient

AETNA  Nyxoah

Very weak diversification

The 3 months correlation between AETNA and Nyxoah is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding AETNA INC 7625 and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and AETNA 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 AETNA INC 7625 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 AETNA i.e., AETNA and Nyxoah go up and down completely randomly.

Pair Corralation between AETNA and Nyxoah

Assuming the 90 days trading horizon AETNA is expected to generate 35.92 times less return on investment than Nyxoah. But when comparing it to its historical volatility, AETNA INC 7625 is 1.27 times less risky than Nyxoah. It trades about 0.01 of its potential returns per unit of risk. Nyxoah is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest  754.00  in Nyxoah on October 9, 2024 and sell it today you would earn a total of  233.00  from holding Nyxoah or generate 30.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	68.42%
Values	Daily Returns

AETNA INC 7625  vs.  Nyxoah

AETNA INC 7625

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AETNA INC 7625 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, AETNA is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Nyxoah

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nyxoah are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. 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.

Pair Trading with AETNA and Nyxoah

The main advantage of trading using opposite AETNA and Nyxoah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AETNA 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 AETNA INC 7625 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.