Correlation Between Advanced Medical and Cellnex Telecom
Can any of the company-specific risk be diversified away by investing in both Advanced Medical and Cellnex Telecom 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 Advanced Medical and Cellnex Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Medical Solutions and Cellnex Telecom SA, you can compare the effects of market volatilities on Advanced Medical and Cellnex Telecom 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 Advanced Medical with a short position of Cellnex Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Medical and Cellnex Telecom.
Diversification Opportunities for Advanced Medical and Cellnex Telecom
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Advanced and Cellnex is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Medical Solutions and Cellnex Telecom SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cellnex Telecom SA and Advanced 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 Advanced Medical Solutions are associated (or correlated) with Cellnex Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cellnex Telecom SA has no effect on the direction of Advanced Medical i.e., Advanced Medical and Cellnex Telecom go up and down completely randomly.
Pair Corralation between Advanced Medical and Cellnex Telecom
Assuming the 90 days trading horizon Advanced Medical Solutions is expected to generate 1.63 times more return on investment than Cellnex Telecom. However, Advanced Medical is 1.63 times more volatile than Cellnex Telecom SA. It trades about 0.1 of its potential returns per unit of risk. Cellnex Telecom SA is currently generating about 0.09 per unit of risk. If you would invest 19,700 in Advanced Medical Solutions on October 29, 2024 and sell it today you would earn a total of 1,200 from holding Advanced Medical Solutions or generate 6.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Medical Solutions vs. Cellnex Telecom SA
Performance |
| Timeline |
| Advanced Medical Sol |
| Cellnex Telecom SA |
Advanced Medical and Cellnex Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Medical and Cellnex Telecom
The main advantage of trading using opposite Advanced Medical and Cellnex Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Medical position performs unexpectedly, Cellnex Telecom 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 Cellnex Telecom will offset losses from the drop in Cellnex Telecom's long position.| Advanced Medical vs. Ecclesiastical Insurance Office | Advanced Medical vs. Sabre Insurance Group | Advanced Medical vs. Premier Foods PLC | Advanced Medical vs. Wheaton Precious Metals |
| Cellnex Telecom vs. Hollywood Bowl Group | Cellnex Telecom vs. Charter Communications Cl | Cellnex Telecom vs. Aeorema Communications Plc | Cellnex Telecom vs. Air Products Chemicals |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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