Correlation Between Cooper Companies, and Fresenius Medical
Can any of the company-specific risk be diversified away by investing in both Cooper Companies, and Fresenius 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 Cooper Companies, and Fresenius Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Cooper Companies, and Fresenius Medical Care, you can compare the effects of market volatilities on Cooper Companies, and Fresenius 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 Cooper Companies, with a short position of Fresenius Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cooper Companies, and Fresenius Medical.
Diversification Opportunities for Cooper Companies, and Fresenius Medical
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cooper and Fresenius is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding The Cooper Companies, and Fresenius Medical Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresenius Medical Care and Cooper Companies, 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 The Cooper Companies, are associated (or correlated) with Fresenius Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresenius Medical Care has no effect on the direction of Cooper Companies, i.e., Cooper Companies, and Fresenius Medical go up and down completely randomly.
Pair Corralation between Cooper Companies, and Fresenius Medical
Considering the 90-day investment horizon The Cooper Companies, is expected to generate 0.79 times more return on investment than Fresenius Medical. However, The Cooper Companies, is 1.27 times less risky than Fresenius Medical. It trades about 0.06 of its potential returns per unit of risk. Fresenius Medical Care is currently generating about 0.04 per unit of risk. If you would invest 8,484 in The Cooper Companies, on September 5, 2024 and sell it today you would earn a total of 1,845 from holding The Cooper Companies, or generate 21.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Cooper Companies, vs. Fresenius Medical Care
Performance |
| Timeline |
| Cooper Companies, |
| Fresenius Medical Care |
Cooper Companies, and Fresenius Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cooper Companies, and Fresenius Medical
The main advantage of trading using opposite Cooper Companies, and Fresenius Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cooper Companies, position performs unexpectedly, Fresenius 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 Fresenius Medical will offset losses from the drop in Fresenius Medical's long position.| Cooper Companies, vs. Baxter International | Cooper Companies, vs. West Pharmaceutical Services | Cooper Companies, vs. ResMed Inc | Cooper Companies, vs. ICU Medical |
| Fresenius Medical vs. Universal Health Services | Fresenius Medical vs. Addus HomeCare | Fresenius Medical vs. HCA Holdings | Fresenius Medical vs. Tenet Healthcare |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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