Correlation Between Diamyd Medical and Compugroup Medical
Can any of the company-specific risk be diversified away by investing in both Diamyd Medical and Compugroup 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 Diamyd Medical and Compugroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamyd Medical AB and Compugroup Medical SE, you can compare the effects of market volatilities on Diamyd Medical and Compugroup 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 Diamyd Medical with a short position of Compugroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamyd Medical and Compugroup Medical.
Diversification Opportunities for Diamyd Medical and Compugroup Medical
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Diamyd and Compugroup is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Diamyd Medical AB and Compugroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compugroup Medical and Diamyd 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 Diamyd Medical AB are associated (or correlated) with Compugroup Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compugroup Medical has no effect on the direction of Diamyd Medical i.e., Diamyd Medical and Compugroup Medical go up and down completely randomly.
Pair Corralation between Diamyd Medical and Compugroup Medical
Assuming the 90 days horizon Diamyd Medical AB is expected to generate 1.39 times more return on investment than Compugroup Medical. However, Diamyd Medical is 1.39 times more volatile than Compugroup Medical SE. It trades about 0.02 of its potential returns per unit of risk. Compugroup Medical SE is currently generating about -0.13 per unit of risk. If you would invest 98.00 in Diamyd Medical AB on August 28, 2024 and sell it today you would earn a total of 1.00 from holding Diamyd Medical AB or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Diamyd Medical AB vs. Compugroup Medical SE
Performance |
| Timeline |
| Diamyd Medical AB |
| Compugroup Medical |
Diamyd Medical and Compugroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diamyd Medical and Compugroup Medical
The main advantage of trading using opposite Diamyd Medical and Compugroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamyd Medical position performs unexpectedly, Compugroup 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 Compugroup Medical will offset losses from the drop in Compugroup Medical's long position.| Diamyd Medical vs. Superior Plus Corp | Diamyd Medical vs. NMI Holdings | Diamyd Medical vs. Origin Agritech | Diamyd Medical vs. SIVERS SEMICONDUCTORS AB |
| Compugroup Medical vs. PTT Global Chemical | Compugroup Medical vs. NIPPON STEEL SPADR | Compugroup Medical vs. COSMOSTEEL HLDGS | Compugroup Medical vs. Khiron Life Sciences |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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