Correlation Between CompuGroup Medical and Ares Management
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and Ares Management 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 Ares Management 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 Ares Management Corp, you can compare the effects of market volatilities on CompuGroup Medical and Ares Management 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 Ares Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and Ares Management.
Diversification Opportunities for CompuGroup Medical and Ares Management
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CompuGroup and Ares is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical SE and Ares Management Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ares Management Corp 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 Ares Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ares Management Corp has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and Ares Management go up and down completely randomly.
Pair Corralation between CompuGroup Medical and Ares Management
Assuming the 90 days trading horizon CompuGroup Medical SE is expected to generate 0.87 times more return on investment than Ares Management. However, CompuGroup Medical SE is 1.15 times less risky than Ares Management. It trades about 0.26 of its potential returns per unit of risk. Ares Management Corp is currently generating about 0.12 per unit of risk. If you would invest 1,378 in CompuGroup Medical SE on September 2, 2024 and sell it today you would earn a total of 213.00 from holding CompuGroup Medical SE or generate 15.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CompuGroup Medical SE vs. Ares Management Corp
Performance |
| Timeline |
| CompuGroup Medical |
| Ares Management Corp |
CompuGroup Medical and Ares Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and Ares Management
The main advantage of trading using opposite CompuGroup Medical and Ares Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, Ares Management 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 Ares Management will offset losses from the drop in Ares Management's long position.| CompuGroup Medical vs. CARSALESCOM | CompuGroup Medical vs. INTER CARS SA | CompuGroup Medical vs. CarsalesCom | CompuGroup Medical vs. Geely Automobile Holdings |
| Ares Management vs. Ameriprise Financial | Ares Management vs. Superior Plus Corp | Ares Management vs. NMI Holdings | Ares Management vs. Origin Agritech |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |