Correlation Between SaltX Technology and Clinical Laserthermia

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

By analyzing existing cross correlation between SaltX Technology Holding and Clinical Laserthermia Systems, you can compare the effects of market volatilities on SaltX Technology and Clinical Laserthermia 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 SaltX Technology with a short position of Clinical Laserthermia. Check out your portfolio center. Please also check ongoing floating volatility patterns of SaltX Technology and Clinical Laserthermia.

Diversification Opportunities for SaltX Technology and Clinical Laserthermia

-0.02

Correlation Coefficient

SaltX Technology  Clinical Laserthermia

Good diversification

The 3 months correlation between SaltX and Clinical is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding SaltX Technology Holding and Clinical Laserthermia Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clinical Laserthermia and SaltX Technology 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 SaltX Technology Holding are associated (or correlated) with Clinical Laserthermia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clinical Laserthermia has no effect on the direction of SaltX Technology i.e., SaltX Technology and Clinical Laserthermia go up and down completely randomly.

Pair Corralation between SaltX Technology and Clinical Laserthermia

Assuming the 90 days trading horizon SaltX Technology Holding is expected to generate 0.65 times more return on investment than Clinical Laserthermia. However, SaltX Technology Holding is 1.54 times less risky than Clinical Laserthermia. It trades about 0.02 of its potential returns per unit of risk. Clinical Laserthermia Systems is currently generating about -0.01 per unit of risk. If you would invest  538.00  in SaltX Technology Holding on September 3, 2024 and sell it today you would lose (156.00) from holding SaltX Technology Holding or give up 29.0% of portfolio value over 90 days.

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

SaltX Technology Holding  vs.  Clinical Laserthermia Systems

SaltX Technology Holding

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SaltX Technology Holding are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain essential indicators, SaltX Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Clinical Laserthermia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Clinical Laserthermia Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with SaltX Technology and Clinical Laserthermia

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

The idea behind SaltX Technology Holding and Clinical Laserthermia Systems 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 Transaction History module to view history of all your transactions and understand their impact on performance.