Correlation Between Medical Properties and Deltex Medical
Can any of the company-specific risk be diversified away by investing in both Medical Properties and Deltex 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 Medical Properties and Deltex Medical 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 Deltex Medical Group, you can compare the effects of market volatilities on Medical Properties and Deltex 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 Medical Properties with a short position of Deltex Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medical Properties and Deltex Medical.
Diversification Opportunities for Medical Properties and Deltex Medical
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Medical and Deltex is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Medical Properties Trust and Deltex Medical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deltex Medical Group 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 Deltex Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deltex Medical Group has no effect on the direction of Medical Properties i.e., Medical Properties and Deltex Medical go up and down completely randomly.
Pair Corralation between Medical Properties and Deltex Medical
Assuming the 90 days trading horizon Medical Properties Trust is expected to generate 0.71 times more return on investment than Deltex Medical. However, Medical Properties Trust is 1.41 times less risky than Deltex Medical. It trades about -0.11 of its potential returns per unit of risk. Deltex Medical Group is currently generating about -0.31 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 | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Medical Properties Trust vs. Deltex Medical Group
Performance |
| Timeline |
| Medical Properties Trust |
| Deltex Medical Group |
Medical Properties and Deltex Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medical Properties and Deltex Medical
The main advantage of trading using opposite Medical Properties and Deltex Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medical Properties position performs unexpectedly, Deltex 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 Deltex Medical will offset losses from the drop in Deltex Medical'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 |
| Deltex Medical vs. Toyota Motor Corp | Deltex Medical vs. SoftBank Group Corp | Deltex Medical vs. OTP Bank Nyrt | Deltex Medical vs. Las Vegas Sands |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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