Correlation Between CompuGroup Medical and Hochschild Mining
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and Hochschild Mining 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 Hochschild Mining 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 Hochschild Mining plc, you can compare the effects of market volatilities on CompuGroup Medical and Hochschild Mining 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 Hochschild Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and Hochschild Mining.
Diversification Opportunities for CompuGroup Medical and Hochschild Mining
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CompuGroup and Hochschild is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical AG and Hochschild Mining plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hochschild Mining plc 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 Hochschild Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hochschild Mining plc has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and Hochschild Mining go up and down completely randomly.
Pair Corralation between CompuGroup Medical and Hochschild Mining
Assuming the 90 days trading horizon CompuGroup Medical AG is expected to generate 0.84 times more return on investment than Hochschild Mining. However, CompuGroup Medical AG is 1.2 times less risky than Hochschild Mining. It trades about 0.07 of its potential returns per unit of risk. Hochschild Mining plc is currently generating about -0.06 per unit of risk. If you would invest 1,363 in CompuGroup Medical AG on August 24, 2024 and sell it today you would earn a total of 40.00 from holding CompuGroup Medical AG or generate 2.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CompuGroup Medical AG vs. Hochschild Mining plc
Performance |
| Timeline |
| CompuGroup Medical |
| Hochschild Mining plc |
CompuGroup Medical and Hochschild Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and Hochschild Mining
The main advantage of trading using opposite CompuGroup Medical and Hochschild Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, Hochschild Mining 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 Hochschild Mining will offset losses from the drop in Hochschild Mining's long position.| CompuGroup Medical vs. Quadrise Plc | CompuGroup Medical vs. Intuitive Investments Group | CompuGroup Medical vs. European Metals Holdings | CompuGroup Medical vs. Athelney Trust plc |
| Hochschild Mining vs. Young Cos Brewery | Hochschild Mining vs. Monster Beverage Corp | Hochschild Mining vs. Adriatic Metals | Hochschild Mining vs. Capital Metals 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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