Correlation Between CompuGroup Medical and GE HealthCare
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and GE HealthCare 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 CompuGroup Medical and GE HealthCare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CompuGroup Medical SE and GE HealthCare Technologies, you can compare the effects of market volatilities on CompuGroup Medical and GE HealthCare 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 CompuGroup Medical with a short position of GE HealthCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and GE HealthCare.
Diversification Opportunities for CompuGroup Medical and GE HealthCare
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between CompuGroup and GEHC is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical SE and GE HealthCare Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE HealthCare Techno and CompuGroup 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 CompuGroup Medical SE are associated (or correlated) with GE HealthCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE HealthCare Techno has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and GE HealthCare go up and down completely randomly.
Pair Corralation between CompuGroup Medical and GE HealthCare
Assuming the 90 days horizon CompuGroup Medical SE is expected to generate 0.32 times more return on investment than GE HealthCare. However, CompuGroup Medical SE is 3.1 times less risky than GE HealthCare. It trades about 0.22 of its potential returns per unit of risk. GE HealthCare Technologies is currently generating about -0.14 per unit of risk. If you would invest 1,449 in CompuGroup Medical SE on September 2, 2024 and sell it today you would earn a total of 31.00 from holding CompuGroup Medical SE or generate 2.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CompuGroup Medical SE vs. GE HealthCare Technologies
Performance |
| Timeline |
| CompuGroup Medical |
| GE HealthCare Techno |
CompuGroup Medical and GE HealthCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and GE HealthCare
The main advantage of trading using opposite CompuGroup Medical and GE HealthCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, GE HealthCare 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 GE HealthCare will offset losses from the drop in GE HealthCare's long position.| CompuGroup Medical vs. GE HealthCare Technologies | CompuGroup Medical vs. Veeva Systems Class | CompuGroup Medical vs. Solventum Corp | CompuGroup Medical vs. Doximity |
| GE HealthCare vs. Teladoc | GE HealthCare vs. Veeva Systems Class | GE HealthCare vs. 10X Genomics | GE HealthCare vs. Progyny |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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