Correlation Between Guardant Health and Nyxoah

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

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

Diversification Opportunities for Guardant Health and Nyxoah

-0.87

Correlation Coefficient

Guardant Health  Nyxoah

Pay attention - limited upside

The 3 months correlation between Guardant and Nyxoah is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Guardant Health and Nyxoah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nyxoah and Guardant Health 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 Guardant Health 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 Guardant Health i.e., Guardant Health and Nyxoah go up and down completely randomly.

Pair Corralation between Guardant Health and Nyxoah

Allowing for the 90-day total investment horizon Guardant Health is expected to under-perform the Nyxoah. In addition to that, Guardant Health is 1.3 times more volatile than Nyxoah. It trades about -0.18 of its total potential returns per unit of risk. Nyxoah is currently generating about -0.05 per unit of volatility. If you would invest  820.00  in Nyxoah on September 25, 2024 and sell it today you would lose (19.00) from holding Nyxoah or give up 2.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	95.24%
Values	Daily Returns

Guardant Health  vs.  Nyxoah

Guardant Health

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Guardant Health are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent technical indicators, Guardant Health demonstrated solid returns over the last few months and may actually be approaching a breakup point.

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 recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Guardant Health and Nyxoah

The main advantage of trading using opposite Guardant Health and Nyxoah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guardant Health 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 Guardant Health 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.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.