Correlation Between ETC On and Surgical Science
Can any of the company-specific risk be diversified away by investing in both ETC On and Surgical Science 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 ETC On and Surgical Science into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ETC on CMCI and Surgical Science Sweden, you can compare the effects of market volatilities on ETC On and Surgical Science 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 ETC On with a short position of Surgical Science. Check out your portfolio center. Please also check ongoing floating volatility patterns of ETC On and Surgical Science.
Diversification Opportunities for ETC On and Surgical Science
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ETC and Surgical is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding ETC on CMCI and Surgical Science Sweden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surgical Science Sweden and ETC On 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 ETC on CMCI are associated (or correlated) with Surgical Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surgical Science Sweden has no effect on the direction of ETC On i.e., ETC On and Surgical Science go up and down completely randomly.
Pair Corralation between ETC On and Surgical Science
Assuming the 90 days trading horizon ETC on CMCI is expected to under-perform the Surgical Science. But the etf apears to be less risky and, when comparing its historical volatility, ETC on CMCI is 3.91 times less risky than Surgical Science. The etf trades about -0.03 of its potential returns per unit of risk. The Surgical Science Sweden is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 14,460 in Surgical Science Sweden on August 29, 2024 and sell it today you would earn a total of 510.00 from holding Surgical Science Sweden or generate 3.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
ETC on CMCI vs. Surgical Science Sweden
Performance |
| Timeline |
| ETC on CMCI |
| Surgical Science Sweden |
ETC On and Surgical Science Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ETC On and Surgical Science
The main advantage of trading using opposite ETC On and Surgical Science positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ETC On position performs unexpectedly, Surgical Science 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 Surgical Science will offset losses from the drop in Surgical Science's long position.The idea behind ETC on CMCI and Surgical Science Sweden pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Surgical Science vs. Flow Traders NV | Surgical Science vs. Jacquet Metal Service | Surgical Science vs. Indutrade AB | Surgical Science vs. Aeorema Communications Plc |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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