Correlation Between ELMOS SEMICONDUCTOR and MEDICAL FACILITIES
Can any of the company-specific risk be diversified away by investing in both ELMOS SEMICONDUCTOR and MEDICAL FACILITIES 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 ELMOS SEMICONDUCTOR and MEDICAL FACILITIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ELMOS SEMICONDUCTOR and MEDICAL FACILITIES NEW, you can compare the effects of market volatilities on ELMOS SEMICONDUCTOR and MEDICAL FACILITIES 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 ELMOS SEMICONDUCTOR with a short position of MEDICAL FACILITIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of ELMOS SEMICONDUCTOR and MEDICAL FACILITIES.
Diversification Opportunities for ELMOS SEMICONDUCTOR and MEDICAL FACILITIES
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ELMOS and MEDICAL is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding ELMOS SEMICONDUCTOR and MEDICAL FACILITIES NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDICAL FACILITIES NEW and ELMOS SEMICONDUCTOR 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 ELMOS SEMICONDUCTOR are associated (or correlated) with MEDICAL FACILITIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDICAL FACILITIES NEW has no effect on the direction of ELMOS SEMICONDUCTOR i.e., ELMOS SEMICONDUCTOR and MEDICAL FACILITIES go up and down completely randomly.
Pair Corralation between ELMOS SEMICONDUCTOR and MEDICAL FACILITIES
Assuming the 90 days trading horizon ELMOS SEMICONDUCTOR is expected to generate 2.46 times more return on investment than MEDICAL FACILITIES. However, ELMOS SEMICONDUCTOR is 2.46 times more volatile than MEDICAL FACILITIES NEW. It trades about 0.25 of its potential returns per unit of risk. MEDICAL FACILITIES NEW is currently generating about -0.04 per unit of risk. If you would invest 6,560 in ELMOS SEMICONDUCTOR on October 11, 2024 and sell it today you would earn a total of 1,070 from holding ELMOS SEMICONDUCTOR or generate 16.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
ELMOS SEMICONDUCTOR vs. MEDICAL FACILITIES NEW
Performance |
| Timeline |
| ELMOS SEMICONDUCTOR |
| MEDICAL FACILITIES NEW |
ELMOS SEMICONDUCTOR and MEDICAL FACILITIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ELMOS SEMICONDUCTOR and MEDICAL FACILITIES
The main advantage of trading using opposite ELMOS SEMICONDUCTOR and MEDICAL FACILITIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ELMOS SEMICONDUCTOR position performs unexpectedly, MEDICAL FACILITIES 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 MEDICAL FACILITIES will offset losses from the drop in MEDICAL FACILITIES's long position.| ELMOS SEMICONDUCTOR vs. Osisko Metals | ELMOS SEMICONDUCTOR vs. Shenandoah Telecommunications | ELMOS SEMICONDUCTOR vs. Nippon Light Metal | ELMOS SEMICONDUCTOR vs. DAIDO METAL TD |
| MEDICAL FACILITIES vs. MOVIE GAMES SA | MEDICAL FACILITIES vs. MUTUIONLINE | MEDICAL FACILITIES vs. Nucletron Electronic Aktiengesellschaft | MEDICAL FACILITIES vs. UNIVERSAL MUSIC 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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