Correlation Between Compugroup Medical and Synopsys
Can any of the company-specific risk be diversified away by investing in both Compugroup Medical and Synopsys 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 Synopsys 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 Synopsys, you can compare the effects of market volatilities on Compugroup Medical and Synopsys 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 Synopsys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compugroup Medical and Synopsys.
Diversification Opportunities for Compugroup Medical and Synopsys
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Compugroup and Synopsys is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Compugroup Medical SE and Synopsys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synopsys 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 Synopsys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synopsys has no effect on the direction of Compugroup Medical i.e., Compugroup Medical and Synopsys go up and down completely randomly.
Pair Corralation between Compugroup Medical and Synopsys
Assuming the 90 days horizon Compugroup Medical SE is expected to generate 1.31 times more return on investment than Synopsys. However, Compugroup Medical is 1.31 times more volatile than Synopsys. It trades about 0.24 of its potential returns per unit of risk. Synopsys is currently generating about 0.2 per unit of risk. If you would invest 1,370 in Compugroup Medical SE on September 4, 2024 and sell it today you would earn a total of 216.00 from holding Compugroup Medical SE or generate 15.77% 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. Synopsys
Performance |
| Timeline |
| Compugroup Medical |
| Synopsys |
Compugroup Medical and Synopsys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compugroup Medical and Synopsys
The main advantage of trading using opposite Compugroup Medical and Synopsys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compugroup Medical position performs unexpectedly, Synopsys 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 Synopsys will offset losses from the drop in Synopsys' long position.| Compugroup Medical vs. 10X GENOMICS DL | Compugroup Medical vs. Teladoc | Compugroup Medical vs. RLX TECH SPADR1 | Compugroup Medical vs. CompuGroup Medical SE |
| Synopsys vs. Food Life Companies | Synopsys vs. ONWARD MEDICAL BV | Synopsys vs. Lery Seafood Group | Synopsys vs. Compugroup Medical SE |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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