Correlation Between AUST AGRICULTURAL and CompuGroup Medical
Can any of the company-specific risk be diversified away by investing in both AUST AGRICULTURAL 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 AUST AGRICULTURAL and CompuGroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AUST AGRICULTURAL and CompuGroup Medical SE, you can compare the effects of market volatilities on AUST AGRICULTURAL 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 AUST AGRICULTURAL with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUST AGRICULTURAL and CompuGroup Medical.
Diversification Opportunities for AUST AGRICULTURAL and CompuGroup Medical
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AUST and CompuGroup is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding AUST AGRICULTURAL and CompuGroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and AUST AGRICULTURAL 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 AUST AGRICULTURAL 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 AUST AGRICULTURAL i.e., AUST AGRICULTURAL and CompuGroup Medical go up and down completely randomly.
Pair Corralation between AUST AGRICULTURAL and CompuGroup Medical
Assuming the 90 days trading horizon AUST AGRICULTURAL is expected to under-perform the CompuGroup Medical. In addition to that, AUST AGRICULTURAL is 1.22 times more volatile than CompuGroup Medical SE. It trades about -0.05 of its total potential returns per unit of risk. CompuGroup Medical SE is currently generating about 0.18 per unit of volatility. If you would invest 2,204 in CompuGroup Medical SE on November 5, 2024 and sell it today you would earn a total of 76.00 from holding CompuGroup Medical SE or generate 3.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AUST AGRICULTURAL vs. CompuGroup Medical SE
Performance |
| Timeline |
| AUST AGRICULTURAL |
| CompuGroup Medical |
AUST AGRICULTURAL and CompuGroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AUST AGRICULTURAL and CompuGroup Medical
The main advantage of trading using opposite AUST AGRICULTURAL and CompuGroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AUST AGRICULTURAL 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.| AUST AGRICULTURAL vs. Zijin Mining Group | AUST AGRICULTURAL vs. PT Steel Pipe | AUST AGRICULTURAL vs. CORNISH METALS INC | AUST AGRICULTURAL vs. BlueScope Steel Limited |
| CompuGroup Medical vs. ATRESMEDIA | CompuGroup Medical vs. Prosiebensat 1 Media | CompuGroup Medical vs. Hisense Home Appliances | CompuGroup Medical vs. Fuji Media Holdings |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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