Correlation Between CompuGroup Medical and Wheaton Precious
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and Wheaton Precious 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 Wheaton Precious 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 Wheaton Precious Metals, you can compare the effects of market volatilities on CompuGroup Medical and Wheaton Precious 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 Wheaton Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and Wheaton Precious.
Diversification Opportunities for CompuGroup Medical and Wheaton Precious
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between CompuGroup and Wheaton is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical AG and Wheaton Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wheaton Precious Metals 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 Wheaton Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wheaton Precious Metals has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and Wheaton Precious go up and down completely randomly.
Pair Corralation between CompuGroup Medical and Wheaton Precious
Assuming the 90 days trading horizon CompuGroup Medical AG is expected to generate 1.26 times more return on investment than Wheaton Precious. However, CompuGroup Medical is 1.26 times more volatile than Wheaton Precious Metals. It trades about 0.2 of its potential returns per unit of risk. Wheaton Precious Metals is currently generating about -0.13 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 Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CompuGroup Medical AG vs. Wheaton Precious Metals
Performance |
| Timeline |
| CompuGroup Medical |
| Wheaton Precious Metals |
CompuGroup Medical and Wheaton Precious Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and Wheaton Precious
The main advantage of trading using opposite CompuGroup Medical and Wheaton Precious positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, Wheaton Precious 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 Wheaton Precious will offset losses from the drop in Wheaton Precious' long position.| CompuGroup Medical vs. Tungsten West PLC | CompuGroup Medical vs. Argo Group Limited | CompuGroup Medical vs. Hardide PLC | CompuGroup Medical vs. Versarien PLC |
| Wheaton Precious vs. Givaudan SA | Wheaton Precious vs. Antofagasta PLC | Wheaton Precious vs. Centamin PLC | Wheaton Precious vs. Atalaya Mining |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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