Correlation Between AVITA Medical and CompuGroup Medical
Can any of the company-specific risk be diversified away by investing in both AVITA Medical and CompuGroup Medical 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 AVITA Medical and CompuGroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AVITA Medical and CompuGroup Medical SE, you can compare the effects of market volatilities on AVITA Medical and CompuGroup Medical 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 AVITA Medical with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVITA Medical and CompuGroup Medical.
Diversification Opportunities for AVITA Medical and CompuGroup Medical
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AVITA and CompuGroup is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding AVITA Medical and CompuGroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and AVITA 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 AVITA Medical are associated (or correlated) with CompuGroup Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CompuGroup Medical has no effect on the direction of AVITA Medical i.e., AVITA Medical and CompuGroup Medical go up and down completely randomly.
Pair Corralation between AVITA Medical and CompuGroup Medical
Assuming the 90 days trading horizon AVITA Medical is expected to generate 1.61 times more return on investment than CompuGroup Medical. However, AVITA Medical is 1.61 times more volatile than CompuGroup Medical SE. It trades about 0.25 of its potential returns per unit of risk. CompuGroup Medical SE is currently generating about 0.24 per unit of risk. If you would invest 186.00 in AVITA Medical on August 31, 2024 and sell it today you would earn a total of 48.00 from holding AVITA Medical or generate 25.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AVITA Medical vs. CompuGroup Medical SE
Performance |
| Timeline |
| AVITA Medical |
| CompuGroup Medical |
AVITA Medical and CompuGroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AVITA Medical and CompuGroup Medical
The main advantage of trading using opposite AVITA Medical and CompuGroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AVITA Medical position performs unexpectedly, CompuGroup Medical 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 CompuGroup Medical will offset losses from the drop in CompuGroup Medical's long position.| AVITA Medical vs. Apple Inc | AVITA Medical vs. Apple Inc | AVITA Medical vs. Apple Inc | AVITA Medical vs. Apple Inc |
| CompuGroup Medical vs. Superior Plus Corp | CompuGroup Medical vs. NMI Holdings | CompuGroup Medical vs. Origin Agritech | CompuGroup Medical vs. SIVERS SEMICONDUCTORS 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |