Correlation Between MEDIPOST and MEDICOX
Can any of the company-specific risk be diversified away by investing in both MEDIPOST and MEDICOX 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 MEDIPOST and MEDICOX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDIPOST Co and MEDICOX Co, you can compare the effects of market volatilities on MEDIPOST and MEDICOX 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 MEDIPOST with a short position of MEDICOX. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDIPOST and MEDICOX.
Diversification Opportunities for MEDIPOST and MEDICOX
Excellent diversification
The 3 months correlation between MEDIPOST and MEDICOX is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding MEDIPOST Co and MEDICOX Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDICOX and MEDIPOST 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 MEDIPOST Co are associated (or correlated) with MEDICOX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDICOX has no effect on the direction of MEDIPOST i.e., MEDIPOST and MEDICOX go up and down completely randomly.
Pair Corralation between MEDIPOST and MEDICOX
Assuming the 90 days trading horizon MEDIPOST Co is expected to generate 0.53 times more return on investment than MEDICOX. However, MEDIPOST Co is 1.89 times less risky than MEDICOX. It trades about 0.09 of its potential returns per unit of risk. MEDICOX Co is currently generating about -0.02 per unit of risk. If you would invest 678,000 in MEDIPOST Co on August 30, 2024 and sell it today you would earn a total of 252,000 from holding MEDIPOST Co or generate 37.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MEDIPOST Co vs. MEDICOX Co
Performance |
| Timeline |
| MEDIPOST |
| MEDICOX |
MEDIPOST and MEDICOX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDIPOST and MEDICOX
The main advantage of trading using opposite MEDIPOST and MEDICOX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDIPOST position performs unexpectedly, MEDICOX 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 MEDICOX will offset losses from the drop in MEDICOX's long position.| MEDIPOST vs. LG Chemicals | MEDIPOST vs. Namhae Chemical | MEDIPOST vs. TK Chemical | MEDIPOST vs. Hyundai Home Shopping |
| MEDICOX vs. Vitzro Tech Co | MEDICOX vs. Busan Industrial Co | MEDICOX vs. Busan Ind | MEDICOX vs. Shinhan WTI Futures |
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 Stocks Directory module to find actively traded stocks across global markets.
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