Correlation Between CompuGroup Medical and Allianz Technology
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and Allianz Technology 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 CompuGroup Medical and Allianz Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CompuGroup Medical AG and Allianz Technology Trust, you can compare the effects of market volatilities on CompuGroup Medical and Allianz Technology 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 CompuGroup Medical with a short position of Allianz Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and Allianz Technology.
Diversification Opportunities for CompuGroup Medical and Allianz Technology
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between CompuGroup and Allianz is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical AG and Allianz Technology Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz Technology Trust and CompuGroup 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 CompuGroup Medical AG are associated (or correlated) with Allianz Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianz Technology Trust has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and Allianz Technology go up and down completely randomly.
Pair Corralation between CompuGroup Medical and Allianz Technology
Assuming the 90 days trading horizon CompuGroup Medical AG is expected to generate 1.42 times more return on investment than Allianz Technology. However, CompuGroup Medical is 1.42 times more volatile than Allianz Technology Trust. It trades about 0.2 of its potential returns per unit of risk. Allianz Technology Trust is currently generating about 0.15 per unit of risk. If you would invest 1,411 in CompuGroup Medical AG on August 30, 2024 and sell it today you would earn a total of 149.00 from holding CompuGroup Medical AG or generate 10.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CompuGroup Medical AG vs. Allianz Technology Trust
Performance |
| Timeline |
| CompuGroup Medical |
| Allianz Technology Trust |
CompuGroup Medical and Allianz Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and Allianz Technology
The main advantage of trading using opposite CompuGroup Medical and Allianz Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, Allianz Technology 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 Allianz Technology will offset losses from the drop in Allianz Technology's long position.| CompuGroup Medical vs. Lendinvest PLC | CompuGroup Medical vs. Neometals | CompuGroup Medical vs. Albion Technology General | CompuGroup Medical vs. Jupiter Fund Management |
| Allianz Technology vs. Toyota Motor Corp | Allianz Technology vs. Lendinvest PLC | Allianz Technology vs. Neometals | Allianz Technology vs. Coor Service Management |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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