Correlation Between Credit Acceptance and Fresenius Medical
Can any of the company-specific risk be diversified away by investing in both Credit Acceptance and Fresenius Medical 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 Credit Acceptance and Fresenius Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Acceptance and Fresenius Medical Care, you can compare the effects of market volatilities on Credit Acceptance and Fresenius Medical 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 Credit Acceptance with a short position of Fresenius Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Acceptance and Fresenius Medical.
Diversification Opportunities for Credit Acceptance and Fresenius Medical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Credit and Fresenius is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Credit Acceptance and Fresenius Medical Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresenius Medical Care and Credit Acceptance 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 Credit Acceptance are associated (or correlated) with Fresenius Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresenius Medical Care has no effect on the direction of Credit Acceptance i.e., Credit Acceptance and Fresenius Medical go up and down completely randomly.
Pair Corralation between Credit Acceptance and Fresenius Medical
If you would invest 10,945 in Fresenius Medical Care on October 30, 2024 and sell it today you would earn a total of 2,744 from holding Fresenius Medical Care or generate 25.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Credit Acceptance vs. Fresenius Medical Care
Performance |
| Timeline |
| Credit Acceptance |
| Fresenius Medical Care |
Credit Acceptance and Fresenius Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Acceptance and Fresenius Medical
The main advantage of trading using opposite Credit Acceptance and Fresenius Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Acceptance position performs unexpectedly, Fresenius Medical 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 Fresenius Medical will offset losses from the drop in Fresenius Medical's long position.| Credit Acceptance vs. Capital One Financial | Credit Acceptance vs. LPL Financial Holdings | Credit Acceptance vs. Jefferies Financial Group | Credit Acceptance vs. Citizens Financial Group, |
| Fresenius Medical vs. Arrow Electronics, | Fresenius Medical vs. Align Technology | Fresenius Medical vs. Fair Isaac | Fresenius Medical vs. Guidewire Software, |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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