Correlation Between Emerging Display and Icares Medicus
Can any of the company-specific risk be diversified away by investing in both Emerging Display and Icares Medicus 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 Emerging Display and Icares Medicus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Display Technologies and Icares Medicus, you can compare the effects of market volatilities on Emerging Display and Icares Medicus 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 Emerging Display with a short position of Icares Medicus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Display and Icares Medicus.
Diversification Opportunities for Emerging Display and Icares Medicus
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Emerging and Icares is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Display Technologies and Icares Medicus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icares Medicus and Emerging Display 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 Emerging Display Technologies are associated (or correlated) with Icares Medicus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icares Medicus has no effect on the direction of Emerging Display i.e., Emerging Display and Icares Medicus go up and down completely randomly.
Pair Corralation between Emerging Display and Icares Medicus
Assuming the 90 days trading horizon Emerging Display Technologies is expected to generate 1.1 times more return on investment than Icares Medicus. However, Emerging Display is 1.1 times more volatile than Icares Medicus. It trades about 0.05 of its potential returns per unit of risk. Icares Medicus is currently generating about 0.05 per unit of risk. If you would invest 2,620 in Emerging Display Technologies on October 25, 2024 and sell it today you would earn a total of 55.00 from holding Emerging Display Technologies or generate 2.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Display Technologies vs. Icares Medicus
Performance |
| Timeline |
| Emerging Display Tec |
| Icares Medicus |
Emerging Display and Icares Medicus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Display and Icares Medicus
The main advantage of trading using opposite Emerging Display and Icares Medicus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Display position performs unexpectedly, Icares Medicus 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 Icares Medicus will offset losses from the drop in Icares Medicus' long position.| Emerging Display vs. Mosa Industrial Corp | Emerging Display vs. Sunspring Metal Corp | Emerging Display vs. Hannstar Display Corp | Emerging Display vs. Jentech Precision Industrial |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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