Correlation Between Fresenius Medical and ANGLE Plc
Can any of the company-specific risk be diversified away by investing in both Fresenius Medical and ANGLE Plc 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 Fresenius Medical and ANGLE Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresenius Medical Care and ANGLE plc, you can compare the effects of market volatilities on Fresenius Medical and ANGLE Plc 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 Fresenius Medical with a short position of ANGLE Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresenius Medical and ANGLE Plc.
Diversification Opportunities for Fresenius Medical and ANGLE Plc
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Fresenius and ANGLE is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Fresenius Medical Care and ANGLE plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGLE plc and Fresenius 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 Fresenius Medical Care are associated (or correlated) with ANGLE Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGLE plc has no effect on the direction of Fresenius Medical i.e., Fresenius Medical and ANGLE Plc go up and down completely randomly.
Pair Corralation between Fresenius Medical and ANGLE Plc
Assuming the 90 days trading horizon Fresenius Medical is expected to generate 3.39 times less return on investment than ANGLE Plc. But when comparing it to its historical volatility, Fresenius Medical Care is 5.54 times less risky than ANGLE Plc. It trades about 0.06 of its potential returns per unit of risk. ANGLE plc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,080 in ANGLE plc on September 14, 2024 and sell it today you would lose (30.00) from holding ANGLE plc or give up 2.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fresenius Medical Care vs. ANGLE plc
Performance |
| Timeline |
| Fresenius Medical Care |
| ANGLE plc |
Fresenius Medical and ANGLE Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresenius Medical and ANGLE Plc
The main advantage of trading using opposite Fresenius Medical and ANGLE Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresenius Medical position performs unexpectedly, ANGLE Plc 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 ANGLE Plc will offset losses from the drop in ANGLE Plc's long position.| Fresenius Medical vs. Monster Beverage Corp | Fresenius Medical vs. MoneysupermarketCom Group PLC | Fresenius Medical vs. Albion Technology General | Fresenius Medical vs. Ocean Harvest Technology |
| ANGLE Plc vs. Fresenius Medical Care | ANGLE Plc vs. Albion Technology General | ANGLE Plc vs. Bytes Technology | ANGLE Plc vs. Eastman Chemical Co |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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