Correlation Between Microbot Medical and SHELF DRILLING

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

By analyzing existing cross correlation between Microbot Medical and SHELF DRILLING LTD, you can compare the effects of market volatilities on Microbot Medical and SHELF DRILLING 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 SHELF DRILLING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microbot Medical and SHELF DRILLING.

Diversification Opportunities for Microbot Medical and SHELF DRILLING

-0.27

Correlation Coefficient

Microbot Medical  SHELF DRILLING

Very good diversification

The 3 months correlation between Microbot and SHELF is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Microbot Medical and SHELF DRILLING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHELF DRILLING LTD 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 SHELF DRILLING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHELF DRILLING LTD has no effect on the direction of Microbot Medical i.e., Microbot Medical and SHELF DRILLING go up and down completely randomly.

Pair Corralation between Microbot Medical and SHELF DRILLING

Assuming the 90 days trading horizon Microbot Medical is expected to generate 2.34 times less return on investment than SHELF DRILLING. But when comparing it to its historical volatility, Microbot Medical is 1.23 times less risky than SHELF DRILLING. It trades about 0.08 of its potential returns per unit of risk. SHELF DRILLING LTD is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  49.00  in SHELF DRILLING LTD on April 23, 2025 and sell it today you would earn a total of  24.00  from holding SHELF DRILLING LTD or generate 48.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

Microbot Medical  vs.  SHELF DRILLING LTD

Microbot Medical

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Microbot Medical are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Microbot Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

SHELF DRILLING LTD

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SHELF DRILLING LTD are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SHELF DRILLING reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Microbot Medical and SHELF DRILLING

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

The idea behind Microbot Medical and SHELF DRILLING LTD 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.