Correlation Between Delcath Systems and Medigus

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

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

Diversification Opportunities for Delcath Systems and Medigus

-0.05

Correlation Coefficient

Delcath Systems  Medigus

Good diversification

The 3 months correlation between Delcath and Medigus is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Delcath Systems and Medigus Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medigus Ltd ADR and Delcath Systems 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 Delcath Systems are associated (or correlated) with Medigus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medigus Ltd ADR has no effect on the direction of Delcath Systems i.e., Delcath Systems and Medigus go up and down completely randomly.

Pair Corralation between Delcath Systems and Medigus

If you would invest  1,056  in Delcath Systems on September 3, 2024 and sell it today you would earn a total of  132.00  from holding Delcath Systems or generate 12.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Delcath Systems  vs.  Medigus Ltd ADR

Delcath Systems

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Delcath Systems are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, Delcath Systems demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Medigus Ltd ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Medigus Ltd ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Medigus is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Delcath Systems and Medigus

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

The idea behind Delcath Systems and Medigus Ltd ADR 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.