Correlation Between Smith Nephew and NAYA Biosciences,

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

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

Diversification Opportunities for Smith Nephew and NAYA Biosciences,

-0.51

Correlation Coefficient

Smith Nephew  NAYA Biosciences,

Excellent diversification

The 3 months correlation between Smith and NAYA is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Smith Nephew SNATS and NAYA Biosciences, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NAYA Biosciences, and Smith Nephew 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 Smith Nephew SNATS are associated (or correlated) with NAYA Biosciences,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NAYA Biosciences, has no effect on the direction of Smith Nephew i.e., Smith Nephew and NAYA Biosciences, go up and down completely randomly.

Pair Corralation between Smith Nephew and NAYA Biosciences,

Considering the 90-day investment horizon Smith Nephew is expected to generate 24.5 times less return on investment than NAYA Biosciences,. But when comparing it to its historical volatility, Smith Nephew SNATS is 11.35 times less risky than NAYA Biosciences,. It trades about 0.01 of its potential returns per unit of risk. NAYA Biosciences, is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  876.00  in NAYA Biosciences, on September 14, 2024 and sell it today you would lose (793.99) from holding NAYA Biosciences, or give up 90.64% of portfolio value over 90 days.

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

Smith Nephew SNATS  vs.  NAYA Biosciences,

Smith Nephew SNATS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Smith Nephew SNATS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

NAYA Biosciences,

Risk-Adjusted Performance

5 of 100

Modest

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

Pair Trading with Smith Nephew and NAYA Biosciences,

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

The idea behind Smith Nephew SNATS and NAYA Biosciences, 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.