Correlation Between Rewalk Robotics and Nihon Kohden

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Can any of the company-specific risk be diversified away by investing in both Rewalk Robotics and Nihon Kohden 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 Rewalk Robotics and Nihon Kohden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rewalk Robotics and Nihon Kohden Corp, you can compare the effects of market volatilities on Rewalk Robotics and Nihon Kohden 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 Rewalk Robotics with a short position of Nihon Kohden. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rewalk Robotics and Nihon Kohden.

Diversification Opportunities for Rewalk Robotics and Nihon Kohden

-0.34
  Correlation Coefficient

Very good diversification

The 3 months correlation between Rewalk and Nihon is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Rewalk Robotics and Nihon Kohden Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nihon Kohden Corp and Rewalk Robotics 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 Rewalk Robotics are associated (or correlated) with Nihon Kohden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nihon Kohden Corp has no effect on the direction of Rewalk Robotics i.e., Rewalk Robotics and Nihon Kohden go up and down completely randomly.

Pair Corralation between Rewalk Robotics and Nihon Kohden

If you would invest  1,456  in Nihon Kohden Corp on September 21, 2024 and sell it today you would earn a total of  59.00  from holding Nihon Kohden Corp or generate 4.05% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy1.59%
ValuesDaily Returns

Rewalk Robotics  vs.  Nihon Kohden Corp

 Performance 
       Timeline  
Rewalk Robotics 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Rewalk Robotics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Rewalk Robotics is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.
Nihon Kohden Corp 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Nihon Kohden Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady forward-looking signals, Nihon Kohden may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Rewalk Robotics and Nihon Kohden Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Rewalk Robotics and Nihon Kohden

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

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