Correlation Between Compugroup Medical and COVIVIO HOTELS
Can any of the company-specific risk be diversified away by investing in both Compugroup Medical and COVIVIO HOTELS 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 COVIVIO HOTELS 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 COVIVIO HOTELS INH, you can compare the effects of market volatilities on Compugroup Medical and COVIVIO HOTELS 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 COVIVIO HOTELS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compugroup Medical and COVIVIO HOTELS.
Diversification Opportunities for Compugroup Medical and COVIVIO HOTELS
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Compugroup and COVIVIO is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Compugroup Medical SE and COVIVIO HOTELS INH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COVIVIO HOTELS INH 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 COVIVIO HOTELS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COVIVIO HOTELS INH has no effect on the direction of Compugroup Medical i.e., Compugroup Medical and COVIVIO HOTELS go up and down completely randomly.
Pair Corralation between Compugroup Medical and COVIVIO HOTELS
Assuming the 90 days horizon Compugroup Medical SE is expected to under-perform the COVIVIO HOTELS. In addition to that, Compugroup Medical is 1.92 times more volatile than COVIVIO HOTELS INH. It trades about -0.09 of its total potential returns per unit of risk. COVIVIO HOTELS INH is currently generating about 0.03 per unit of volatility. If you would invest 1,564 in COVIVIO HOTELS INH on September 1, 2024 and sell it today you would earn a total of 256.00 from holding COVIVIO HOTELS INH or generate 16.37% 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. COVIVIO HOTELS INH
Performance |
| Timeline |
| Compugroup Medical |
| COVIVIO HOTELS INH |
Compugroup Medical and COVIVIO HOTELS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compugroup Medical and COVIVIO HOTELS
The main advantage of trading using opposite Compugroup Medical and COVIVIO HOTELS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compugroup Medical position performs unexpectedly, COVIVIO HOTELS 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 COVIVIO HOTELS will offset losses from the drop in COVIVIO HOTELS's long position.| Compugroup Medical vs. Reliance Steel Aluminum | Compugroup Medical vs. LEGACY IRON ORE | Compugroup Medical vs. THAI BEVERAGE | Compugroup Medical vs. United States Steel |
| COVIVIO HOTELS vs. Apple Inc | COVIVIO HOTELS vs. Apple Inc | COVIVIO HOTELS vs. Apple Inc | COVIVIO HOTELS vs. Apple Inc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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