Correlation Between Medical Properties and Telecom Italia
Can any of the company-specific risk be diversified away by investing in both Medical Properties and Telecom Italia 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 Medical Properties and Telecom Italia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medical Properties Trust and Telecom Italia SpA, you can compare the effects of market volatilities on Medical Properties and Telecom Italia 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 Medical Properties with a short position of Telecom Italia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medical Properties and Telecom Italia.
Diversification Opportunities for Medical Properties and Telecom Italia
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Medical and Telecom is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Medical Properties Trust and Telecom Italia SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telecom Italia SpA and Medical Properties 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 Medical Properties Trust are associated (or correlated) with Telecom Italia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telecom Italia SpA has no effect on the direction of Medical Properties i.e., Medical Properties and Telecom Italia go up and down completely randomly.
Pair Corralation between Medical Properties and Telecom Italia
Assuming the 90 days trading horizon Medical Properties Trust is expected to under-perform the Telecom Italia. In addition to that, Medical Properties is 1.3 times more volatile than Telecom Italia SpA. It trades about -0.05 of its total potential returns per unit of risk. Telecom Italia SpA is currently generating about 0.01 per unit of volatility. If you would invest 27.00 in Telecom Italia SpA on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Telecom Italia SpA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medical Properties Trust vs. Telecom Italia SpA
Performance |
| Timeline |
| Medical Properties Trust |
| Telecom Italia SpA |
Medical Properties and Telecom Italia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medical Properties and Telecom Italia
The main advantage of trading using opposite Medical Properties and Telecom Italia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medical Properties position performs unexpectedly, Telecom Italia 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 Telecom Italia will offset losses from the drop in Telecom Italia's long position.| Medical Properties vs. Neometals | Medical Properties vs. Wheaton Precious Metals | Medical Properties vs. JB Hunt Transport | Medical Properties vs. Metals Exploration Plc |
| Telecom Italia vs. Sunny Optical Technology | Telecom Italia vs. Microchip Technology | Telecom Italia vs. Westlake Chemical Corp | Telecom Italia vs. DXC Technology 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |