Correlation Between Alfa Financial and XTANT MEDICAL
Can any of the company-specific risk be diversified away by investing in both Alfa Financial and XTANT 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 Alfa Financial and XTANT MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfa Financial Software and XTANT MEDICAL HLDGS, you can compare the effects of market volatilities on Alfa Financial and XTANT 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 Alfa Financial with a short position of XTANT MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Financial and XTANT MEDICAL.
Diversification Opportunities for Alfa Financial and XTANT MEDICAL
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alfa and XTANT is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Financial Software and XTANT MEDICAL HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XTANT MEDICAL HLDGS and Alfa Financial 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 Alfa Financial Software are associated (or correlated) with XTANT MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XTANT MEDICAL HLDGS has no effect on the direction of Alfa Financial i.e., Alfa Financial and XTANT MEDICAL go up and down completely randomly.
Pair Corralation between Alfa Financial and XTANT MEDICAL
Assuming the 90 days trading horizon Alfa Financial Software is expected to generate 0.45 times more return on investment than XTANT MEDICAL. However, Alfa Financial Software is 2.24 times less risky than XTANT MEDICAL. It trades about 0.04 of its potential returns per unit of risk. XTANT MEDICAL HLDGS is currently generating about 0.01 per unit of risk. If you would invest 176.00 in Alfa Financial Software on October 16, 2024 and sell it today you would earn a total of 56.00 from holding Alfa Financial Software or generate 31.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alfa Financial Software vs. XTANT MEDICAL HLDGS
Performance |
| Timeline |
| Alfa Financial Software |
| XTANT MEDICAL HLDGS |
Alfa Financial and XTANT MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alfa Financial and XTANT MEDICAL
The main advantage of trading using opposite Alfa Financial and XTANT MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfa Financial position performs unexpectedly, XTANT 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 XTANT MEDICAL will offset losses from the drop in XTANT MEDICAL's long position.| Alfa Financial vs. Iridium Communications | Alfa Financial vs. ecotel communication ag | Alfa Financial vs. Cairo Communication SpA | Alfa Financial vs. Chengdu PUTIAN Telecommunications |
| XTANT MEDICAL vs. Liberty Broadband | XTANT MEDICAL vs. Gaztransport Technigaz SA | XTANT MEDICAL vs. TEXAS ROADHOUSE | XTANT MEDICAL vs. Align Technology |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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