Correlation Between Medical Properties and Southern Copper
Can any of the company-specific risk be diversified away by investing in both Medical Properties and Southern Copper 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 Southern Copper 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 Southern Copper Corp, you can compare the effects of market volatilities on Medical Properties and Southern Copper 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 Southern Copper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medical Properties and Southern Copper.
Diversification Opportunities for Medical Properties and Southern Copper
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Medical and Southern is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Medical Properties Trust and Southern Copper Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern Copper Corp 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 Southern Copper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern Copper Corp has no effect on the direction of Medical Properties i.e., Medical Properties and Southern Copper go up and down completely randomly.
Pair Corralation between Medical Properties and Southern Copper
Assuming the 90 days trading horizon Medical Properties Trust is expected to generate 1.61 times more return on investment than Southern Copper. However, Medical Properties is 1.61 times more volatile than Southern Copper Corp. It trades about -0.11 of its potential returns per unit of risk. Southern Copper Corp is currently generating about -0.28 per unit of risk. If you would invest 467.00 in Medical Properties Trust on August 30, 2024 and sell it today you would lose (38.00) from holding Medical Properties Trust or give up 8.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Medical Properties Trust vs. Southern Copper Corp
Performance |
| Timeline |
| Medical Properties Trust |
| Southern Copper Corp |
Medical Properties and Southern Copper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medical Properties and Southern Copper
The main advantage of trading using opposite Medical Properties and Southern Copper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medical Properties position performs unexpectedly, Southern Copper 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 Southern Copper will offset losses from the drop in Southern Copper's long position.| Medical Properties vs. Tungsten West PLC | Medical Properties vs. Argo Group Limited | Medical Properties vs. Hardide PLC | Medical Properties vs. Versarien PLC |
| Southern Copper vs. Tungsten West PLC | Southern Copper vs. Argo Group Limited | Southern Copper vs. Hardide PLC | Southern Copper vs. Versarien PLC |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |