Correlation Between CompuGroup Medical and NH Foods
Can any of the company-specific risk be diversified away by investing in both CompuGroup Medical and NH Foods 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 NH Foods 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 NH Foods, you can compare the effects of market volatilities on CompuGroup Medical and NH Foods 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 NH Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompuGroup Medical and NH Foods.
Diversification Opportunities for CompuGroup Medical and NH Foods
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between CompuGroup and NI6 is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding CompuGroup Medical SE and NH Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Foods 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 NH Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Foods has no effect on the direction of CompuGroup Medical i.e., CompuGroup Medical and NH Foods go up and down completely randomly.
Pair Corralation between CompuGroup Medical and NH Foods
Assuming the 90 days trading horizon CompuGroup Medical SE is expected to under-perform the NH Foods. In addition to that, CompuGroup Medical is 2.04 times more volatile than NH Foods. It trades about -0.03 of its total potential returns per unit of risk. NH Foods is currently generating about 0.03 per unit of volatility. If you would invest 2,540 in NH Foods on October 30, 2024 and sell it today you would earn a total of 540.00 from holding NH Foods or generate 21.26% 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. NH Foods
Performance |
| Timeline |
| CompuGroup Medical |
| NH Foods |
CompuGroup Medical and NH Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompuGroup Medical and NH Foods
The main advantage of trading using opposite CompuGroup Medical and NH Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompuGroup Medical position performs unexpectedly, NH Foods 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 NH Foods will offset losses from the drop in NH Foods' long position.| CompuGroup Medical vs. Veeva Systems | CompuGroup Medical vs. Teladoc | CompuGroup Medical vs. Evolent Health | CompuGroup Medical vs. Compugroup Medical SE |
| NH Foods vs. FIREWEED METALS P | NH Foods vs. FUYO GENERAL LEASE | NH Foods vs. Air Lease | NH Foods vs. Lendlease Group |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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