Correlation Between CompuGroup Medical and Alfa Financial
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and Alfa Financial 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 Alfa Financial 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 Alfa Financial Software, you can compare the effects of market volatilities on CompuGroup Medical and Alfa Financial 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 Alfa Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and Alfa Financial.
Diversification Opportunities for CompuGroup Medical and Alfa Financial
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CompuGroup and Alfa is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical SE and Alfa Financial Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfa Financial Software 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 Alfa Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfa Financial Software has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and Alfa Financial go up and down completely randomly.
Pair Corralation between CompuGroup Medical and Alfa Financial
Assuming the 90 days trading horizon CompuGroup Medical SE is expected to under-perform the Alfa Financial. In addition to that, CompuGroup Medical is 1.12 times more volatile than Alfa Financial Software. It trades about -0.08 of its total potential returns per unit of risk. Alfa Financial Software is currently generating about 0.05 per unit of volatility. If you would invest 173.00 in Alfa Financial Software on August 27, 2024 and sell it today you would earn a total of 81.00 from holding Alfa Financial Software or generate 46.82% 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. Alfa Financial Software
Performance |
| Timeline |
| CompuGroup Medical |
| Alfa Financial Software |
CompuGroup Medical and Alfa Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and Alfa Financial
The main advantage of trading using opposite CompuGroup Medical and Alfa Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, Alfa Financial 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 Alfa Financial will offset losses from the drop in Alfa Financial's long position.| CompuGroup Medical vs. Superior Plus Corp | CompuGroup Medical vs. NMI Holdings | CompuGroup Medical vs. Origin Agritech | CompuGroup Medical vs. SIVERS SEMICONDUCTORS AB |
| Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial vs. Apple Inc | Alfa Financial 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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