Correlation Between NLS Pharmaceutics and Cardio Diagnostics

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

By analyzing existing cross correlation between NLS Pharmaceutics AG and Cardio Diagnostics Holdings, you can compare the effects of market volatilities on NLS Pharmaceutics and Cardio Diagnostics 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 NLS Pharmaceutics with a short position of Cardio Diagnostics. Check out your portfolio center. Please also check ongoing floating volatility patterns of NLS Pharmaceutics and Cardio Diagnostics.

Diversification Opportunities for NLS Pharmaceutics and Cardio Diagnostics

-0.68

Correlation Coefficient

NLS Pharmaceutics  Cardio Diagnostics

Excellent diversification

The 3 months correlation between NLS and Cardio is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding NLS Pharmaceutics AG and Cardio Diagnostics Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardio Diagnostics and NLS Pharmaceutics 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 NLS Pharmaceutics AG are associated (or correlated) with Cardio Diagnostics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardio Diagnostics has no effect on the direction of NLS Pharmaceutics i.e., NLS Pharmaceutics and Cardio Diagnostics go up and down completely randomly.

Pair Corralation between NLS Pharmaceutics and Cardio Diagnostics

Assuming the 90 days horizon NLS Pharmaceutics AG is expected to generate 4.57 times more return on investment than Cardio Diagnostics. However, NLS Pharmaceutics is 4.57 times more volatile than Cardio Diagnostics Holdings. It trades about 0.17 of its potential returns per unit of risk. Cardio Diagnostics Holdings is currently generating about -0.12 per unit of risk. If you would invest  0.40  in NLS Pharmaceutics AG on May 4, 2025 and sell it today you would earn a total of  1.00  from holding NLS Pharmaceutics AG or generate 250.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	87.1%
Values	Daily Returns

NLS Pharmaceutics AG  vs.  Cardio Diagnostics Holdings

NLS Pharmaceutics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in NLS Pharmaceutics AG are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, NLS Pharmaceutics showed solid returns over the last few months and may actually be approaching a breakup point.

Cardio Diagnostics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cardio Diagnostics Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in September 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with NLS Pharmaceutics and Cardio Diagnostics

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

The idea behind NLS Pharmaceutics AG and Cardio Diagnostics Holdings 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.