Correlation Between Compugroup Medical and Hollywood Bowl
Can any of the company-specific risk be diversified away by investing in both Compugroup Medical and Hollywood Bowl 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 Hollywood Bowl 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 Hollywood Bowl Group, you can compare the effects of market volatilities on Compugroup Medical and Hollywood Bowl 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 Hollywood Bowl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compugroup Medical and Hollywood Bowl.
Diversification Opportunities for Compugroup Medical and Hollywood Bowl
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Compugroup and Hollywood is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Compugroup Medical SE and Hollywood Bowl Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hollywood Bowl Group 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 Hollywood Bowl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hollywood Bowl Group has no effect on the direction of Compugroup Medical i.e., Compugroup Medical and Hollywood Bowl go up and down completely randomly.
Pair Corralation between Compugroup Medical and Hollywood Bowl
Assuming the 90 days horizon Compugroup Medical SE is expected to under-perform the Hollywood Bowl. In addition to that, Compugroup Medical is 1.6 times more volatile than Hollywood Bowl Group. It trades about -0.02 of its total potential returns per unit of risk. Hollywood Bowl Group is currently generating about 0.06 per unit of volatility. If you would invest 252.00 in Hollywood Bowl Group on September 13, 2024 and sell it today you would earn a total of 144.00 from holding Hollywood Bowl Group or generate 57.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Compugroup Medical SE vs. Hollywood Bowl Group
Performance |
| Timeline |
| Compugroup Medical |
| Hollywood Bowl Group |
Compugroup Medical and Hollywood Bowl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compugroup Medical and Hollywood Bowl
The main advantage of trading using opposite Compugroup Medical and Hollywood Bowl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compugroup Medical position performs unexpectedly, Hollywood Bowl 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 Hollywood Bowl will offset losses from the drop in Hollywood Bowl's long position.| Compugroup Medical vs. Evolent Health | Compugroup Medical vs. CompuGroup Medical SE | Compugroup Medical vs. Superior Plus Corp | Compugroup Medical vs. NMI Holdings |
| Hollywood Bowl vs. Superior Plus Corp | Hollywood Bowl vs. SIVERS SEMICONDUCTORS AB | Hollywood Bowl vs. Norsk Hydro ASA | Hollywood Bowl vs. Reliance Steel Aluminum |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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