Correlation Between MEDICAL FACILITIES and Intel
Can any of the company-specific risk be diversified away by investing in both MEDICAL FACILITIES and Intel 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 MEDICAL FACILITIES and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDICAL FACILITIES NEW and Intel, you can compare the effects of market volatilities on MEDICAL FACILITIES and Intel 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 MEDICAL FACILITIES with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDICAL FACILITIES and Intel.
Diversification Opportunities for MEDICAL FACILITIES and Intel
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between MEDICAL and Intel is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding MEDICAL FACILITIES NEW and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and MEDICAL FACILITIES 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 MEDICAL FACILITIES NEW are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of MEDICAL FACILITIES i.e., MEDICAL FACILITIES and Intel go up and down completely randomly.
Pair Corralation between MEDICAL FACILITIES and Intel
Assuming the 90 days horizon MEDICAL FACILITIES is expected to generate 1.05 times less return on investment than Intel. But when comparing it to its historical volatility, MEDICAL FACILITIES NEW is 1.2 times less risky than Intel. It trades about 0.27 of its potential returns per unit of risk. Intel is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 1,941 in Intel on October 22, 2024 and sell it today you would earn a total of 187.00 from holding Intel or generate 9.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
MEDICAL FACILITIES NEW vs. Intel
Performance |
| Timeline |
| MEDICAL FACILITIES NEW |
| Intel |
MEDICAL FACILITIES and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDICAL FACILITIES and Intel
The main advantage of trading using opposite MEDICAL FACILITIES and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDICAL FACILITIES position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| MEDICAL FACILITIES vs. GOODYEAR T RUBBER | MEDICAL FACILITIES vs. Vulcan Materials | MEDICAL FACILITIES vs. CONTAGIOUS GAMING INC | MEDICAL FACILITIES vs. Martin Marietta Materials |
| Intel vs. MEDICAL FACILITIES NEW | Intel vs. SPAGO NANOMEDICAL AB | Intel vs. Genertec Universal Medical | Intel vs. Diamyd Medical AB |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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