Correlation Between Elmos Semiconductor and CARDINAL HEALTH
Can any of the company-specific risk be diversified away by investing in both Elmos Semiconductor and CARDINAL HEALTH 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 CARDINAL HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elmos Semiconductor SE and CARDINAL HEALTH, you can compare the effects of market volatilities on Elmos Semiconductor and CARDINAL HEALTH 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 CARDINAL HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elmos Semiconductor and CARDINAL HEALTH.
Diversification Opportunities for Elmos Semiconductor and CARDINAL HEALTH
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Elmos and CARDINAL is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Elmos Semiconductor SE and CARDINAL HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARDINAL HEALTH 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 SE are associated (or correlated) with CARDINAL HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARDINAL HEALTH has no effect on the direction of Elmos Semiconductor i.e., Elmos Semiconductor and CARDINAL HEALTH go up and down completely randomly.
Pair Corralation between Elmos Semiconductor and CARDINAL HEALTH
Assuming the 90 days trading horizon Elmos Semiconductor SE is expected to generate 5.65 times more return on investment than CARDINAL HEALTH. However, Elmos Semiconductor is 5.65 times more volatile than CARDINAL HEALTH. It trades about 0.26 of its potential returns per unit of risk. CARDINAL HEALTH is currently generating about 0.63 per unit of risk. If you would invest 6,810 in Elmos Semiconductor SE on October 14, 2024 and sell it today you would earn a total of 1,000.00 from holding Elmos Semiconductor SE or generate 14.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elmos Semiconductor SE vs. CARDINAL HEALTH
Performance |
| Timeline |
| Elmos Semiconductor |
| CARDINAL HEALTH |
Elmos Semiconductor and CARDINAL HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elmos Semiconductor and CARDINAL HEALTH
The main advantage of trading using opposite Elmos Semiconductor and CARDINAL HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elmos Semiconductor position performs unexpectedly, CARDINAL HEALTH 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 CARDINAL HEALTH will offset losses from the drop in CARDINAL HEALTH's long position.| Elmos Semiconductor vs. ACCSYS TECHPLC EO | Elmos Semiconductor vs. Semiconductor Manufacturing International | Elmos Semiconductor vs. VELA TECHNOLPLC LS 0001 | Elmos Semiconductor vs. THORNEY TECHS LTD |
| CARDINAL HEALTH vs. MARKET VECTR RETAIL | CARDINAL HEALTH vs. Eidesvik Offshore ASA | CARDINAL HEALTH vs. Elmos Semiconductor SE | CARDINAL HEALTH vs. BW OFFSHORE LTD |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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