Correlation Between CVR Energy and Advanced Medical
Can any of the company-specific risk be diversified away by investing in both CVR Energy and Advanced Medical 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 CVR Energy and Advanced Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Energy and Advanced Medical Solutions, you can compare the effects of market volatilities on CVR Energy and Advanced Medical 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 CVR Energy with a short position of Advanced Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Advanced Medical.
Diversification Opportunities for CVR Energy and Advanced Medical
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between CVR and Advanced is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Advanced Medical Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advanced Medical Sol and CVR Energy 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 CVR Energy are associated (or correlated) with Advanced Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advanced Medical Sol has no effect on the direction of CVR Energy i.e., CVR Energy and Advanced Medical go up and down completely randomly.
Pair Corralation between CVR Energy and Advanced Medical
Assuming the 90 days trading horizon CVR Energy is expected to under-perform the Advanced Medical. In addition to that, CVR Energy is 1.42 times more volatile than Advanced Medical Solutions. It trades about -0.05 of its total potential returns per unit of risk. Advanced Medical Solutions is currently generating about 0.02 per unit of volatility. If you would invest 21,026 in Advanced Medical Solutions on September 2, 2024 and sell it today you would earn a total of 274.00 from holding Advanced Medical Solutions or generate 1.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.12% |
| Values | Daily Returns |
CVR Energy vs. Advanced Medical Solutions
Performance |
| Timeline |
| CVR Energy |
| Advanced Medical Sol |
CVR Energy and Advanced Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Energy and Advanced Medical
The main advantage of trading using opposite CVR Energy and Advanced Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Advanced Medical 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 Advanced Medical will offset losses from the drop in Advanced Medical's long position.| CVR Energy vs. Uniper SE | CVR Energy vs. Mulberry Group PLC | CVR Energy vs. London Security Plc | CVR Energy vs. Triad Group PLC |
| Advanced Medical vs. JD Sports Fashion | Advanced Medical vs. Samsung Electronics Co | Advanced Medical vs. Grand Vision Media | Advanced Medical vs. United States Steel |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |