Correlation Between Microbot Medical and ResMed

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

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

Diversification Opportunities for Microbot Medical and ResMed

0.32

Correlation Coefficient

Microbot Medical  ResMed

Weak diversification

The 3 months correlation between Microbot and ResMed is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and ResMed Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ResMed Inc and Microbot Medical 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 Microbot Medical are associated (or correlated) with ResMed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ResMed Inc has no effect on the direction of Microbot Medical i.e., Microbot Medical and ResMed go up and down completely randomly.

Pair Corralation between Microbot Medical and ResMed

Given the investment horizon of 90 days Microbot Medical is expected to generate 1.14 times less return on investment than ResMed. In addition to that, Microbot Medical is 4.81 times more volatile than ResMed Inc. It trades about 0.05 of its total potential returns per unit of risk. ResMed Inc is currently generating about 0.29 per unit of volatility. If you would invest  23,943  in ResMed Inc on May 2, 2025 and sell it today you would earn a total of  3,801  from holding ResMed Inc or generate 15.88% return on investment over 90 days.

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

Microbot Medical  vs.  ResMed Inc

Microbot Medical

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Microbot Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

ResMed Inc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ResMed Inc are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, ResMed exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Microbot Medical and ResMed

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

The idea behind Microbot Medical and ResMed Inc 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.