Correlation Between Advanced Medical and Palantir Technologies
Can any of the company-specific risk be diversified away by investing in both Advanced Medical and Palantir Technologies 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 Palantir Technologies 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 Palantir Technologies, you can compare the effects of market volatilities on Advanced Medical and Palantir Technologies 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 Palantir Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Medical and Palantir Technologies.
Diversification Opportunities for Advanced Medical and Palantir Technologies
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Advanced and Palantir is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Medical Solutions and Palantir Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Palantir Technologies 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 Palantir Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Palantir Technologies has no effect on the direction of Advanced Medical i.e., Advanced Medical and Palantir Technologies go up and down completely randomly.
Pair Corralation between Advanced Medical and Palantir Technologies
Assuming the 90 days trading horizon Advanced Medical is expected to generate 1135.2 times less return on investment than Palantir Technologies. But when comparing it to its historical volatility, Advanced Medical Solutions is 1.61 times less risky than Palantir Technologies. It trades about 0.0 of its potential returns per unit of risk. Palantir Technologies is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 700.00 in Palantir Technologies on November 1, 2024 and sell it today you would earn a total of 6,982 from holding Palantir Technologies or generate 997.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Advanced Medical Solutions vs. Palantir Technologies
Performance |
| Timeline |
| Advanced Medical Sol |
| Palantir Technologies |
Advanced Medical and Palantir Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Medical and Palantir Technologies
The main advantage of trading using opposite Advanced Medical and Palantir Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Medical position performs unexpectedly, Palantir Technologies 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 Palantir Technologies will offset losses from the drop in Palantir Technologies' long position.| Advanced Medical vs. Compagnie Plastic Omnium | Advanced Medical vs. APPLIED MATERIALS | Advanced Medical vs. Hanison Construction Holdings | Advanced Medical vs. EAGLE MATERIALS |
| Palantir Technologies vs. SOEDER SPORTFISKE AB | Palantir Technologies vs. SAN MIGUEL BREWERY | Palantir Technologies vs. THAI BEVERAGE | Palantir Technologies vs. USWE SPORTS 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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