Correlation Between CREO MEDICAL and Acer Incorporated
Can any of the company-specific risk be diversified away by investing in both CREO MEDICAL and Acer Incorporated 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 CREO MEDICAL and Acer Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CREO MEDICAL GRP and Acer Incorporated, you can compare the effects of market volatilities on CREO MEDICAL and Acer Incorporated 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 CREO MEDICAL with a short position of Acer Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of CREO MEDICAL and Acer Incorporated.
Diversification Opportunities for CREO MEDICAL and Acer Incorporated
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between CREO and Acer is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding CREO MEDICAL GRP and Acer Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acer Incorporated and CREO 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 CREO MEDICAL GRP are associated (or correlated) with Acer Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acer Incorporated has no effect on the direction of CREO MEDICAL i.e., CREO MEDICAL and Acer Incorporated go up and down completely randomly.
Pair Corralation between CREO MEDICAL and Acer Incorporated
Assuming the 90 days horizon CREO MEDICAL GRP is expected to under-perform the Acer Incorporated. But the stock apears to be less risky and, when comparing its historical volatility, CREO MEDICAL GRP is 2.66 times less risky than Acer Incorporated. The stock trades about -0.07 of its potential returns per unit of risk. The Acer Incorporated is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 460.00 in Acer Incorporated on November 4, 2024 and sell it today you would earn a total of 0.00 from holding Acer Incorporated or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
CREO MEDICAL GRP vs. Acer Incorporated
Performance |
| Timeline |
| CREO MEDICAL GRP |
| Acer Incorporated |
CREO MEDICAL and Acer Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CREO MEDICAL and Acer Incorporated
The main advantage of trading using opposite CREO MEDICAL and Acer Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CREO MEDICAL position performs unexpectedly, Acer Incorporated 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 Acer Incorporated will offset losses from the drop in Acer Incorporated's long position.| CREO MEDICAL vs. Titan Machinery | CREO MEDICAL vs. CHRYSALIS INVESTMENTS LTD | CREO MEDICAL vs. FARM 51 GROUP | CREO MEDICAL vs. Hanison Construction Holdings |
| Acer Incorporated vs. Arista Networks | Acer Incorporated vs. Lenovo Group Limited | Acer Incorporated vs. Lenovo Group Limited | Acer Incorporated vs. Seiko Epson |
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 Stocks Directory module to find actively traded stocks across global markets.
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