Correlation Between Cembra Money and Medical Properties
Can any of the company-specific risk be diversified away by investing in both Cembra Money and Medical Properties 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 Cembra Money and Medical Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cembra Money Bank and Medical Properties Trust, you can compare the effects of market volatilities on Cembra Money and Medical Properties 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 Cembra Money with a short position of Medical Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cembra Money and Medical Properties.
Diversification Opportunities for Cembra Money and Medical Properties
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cembra and Medical is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Cembra Money Bank and Medical Properties Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medical Properties Trust and Cembra Money 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 Cembra Money Bank are associated (or correlated) with Medical Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medical Properties Trust has no effect on the direction of Cembra Money i.e., Cembra Money and Medical Properties go up and down completely randomly.
Pair Corralation between Cembra Money and Medical Properties
Assuming the 90 days trading horizon Cembra Money Bank is expected to generate 0.2 times more return on investment than Medical Properties. However, Cembra Money Bank is 5.12 times less risky than Medical Properties. It trades about 0.7 of its potential returns per unit of risk. Medical Properties Trust is currently generating about 0.12 per unit of risk. If you would invest 8,155 in Cembra Money Bank on October 22, 2024 and sell it today you would earn a total of 730.00 from holding Cembra Money Bank or generate 8.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Cembra Money Bank vs. Medical Properties Trust
Performance |
| Timeline |
| Cembra Money Bank |
| Medical Properties Trust |
Cembra Money and Medical Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cembra Money and Medical Properties
The main advantage of trading using opposite Cembra Money and Medical Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cembra Money position performs unexpectedly, Medical Properties 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 Medical Properties will offset losses from the drop in Medical Properties' long position.| Cembra Money vs. Sunny Optical Technology | Cembra Money vs. International Biotechnology Trust | Cembra Money vs. Pfeiffer Vacuum Technology | Cembra Money vs. Alaska Air Group |
| Medical Properties vs. One Media iP | Medical Properties vs. Flutter Entertainment PLC | Medical Properties vs. Zinc Media Group | Medical Properties vs. Liberty Media Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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