Correlation Between Coloplast and Haemonetics
Can any of the company-specific risk be diversified away by investing in both Coloplast and Haemonetics 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 Coloplast and Haemonetics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coloplast A and Haemonetics, you can compare the effects of market volatilities on Coloplast and Haemonetics 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 Coloplast with a short position of Haemonetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coloplast and Haemonetics.
Diversification Opportunities for Coloplast and Haemonetics
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Coloplast and Haemonetics is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Coloplast A and Haemonetics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haemonetics and Coloplast 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 Coloplast A are associated (or correlated) with Haemonetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haemonetics has no effect on the direction of Coloplast i.e., Coloplast and Haemonetics go up and down completely randomly.
Pair Corralation between Coloplast and Haemonetics
Assuming the 90 days horizon Coloplast A is expected to under-perform the Haemonetics. But the pink sheet apears to be less risky and, when comparing its historical volatility, Coloplast A is 1.99 times less risky than Haemonetics. The pink sheet trades about -0.04 of its potential returns per unit of risk. The Haemonetics is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 7,353 in Haemonetics on September 4, 2024 and sell it today you would earn a total of 1,395 from holding Haemonetics or generate 18.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coloplast A vs. Haemonetics
Performance |
| Timeline |
| Coloplast A |
| Haemonetics |
Coloplast and Haemonetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coloplast and Haemonetics
The main advantage of trading using opposite Coloplast and Haemonetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coloplast position performs unexpectedly, Haemonetics 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 Haemonetics will offset losses from the drop in Haemonetics' long position.| Coloplast vs. Straumann Holding AG | Coloplast vs. Hoya Corp | Coloplast vs. EssilorLuxottica Socit anonyme | Coloplast vs. Essilor International SA |
| Haemonetics vs. Merit Medical Systems | Haemonetics vs. AngioDynamics | Haemonetics vs. AptarGroup | Haemonetics vs. Envista Holdings Corp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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