Correlation Between Embla Medical and Fundamental Invest
Can any of the company-specific risk be diversified away by investing in both Embla Medical and Fundamental Invest 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 Embla Medical and Fundamental Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Embla Medical hf and Fundamental Invest Stock, you can compare the effects of market volatilities on Embla Medical and Fundamental Invest 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 Embla Medical with a short position of Fundamental Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Embla Medical and Fundamental Invest.
Diversification Opportunities for Embla Medical and Fundamental Invest
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Embla and Fundamental is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Embla Medical hf and Fundamental Invest Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fundamental Invest Stock and Embla 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 Embla Medical hf are associated (or correlated) with Fundamental Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fundamental Invest Stock has no effect on the direction of Embla Medical i.e., Embla Medical and Fundamental Invest go up and down completely randomly.
Pair Corralation between Embla Medical and Fundamental Invest
Assuming the 90 days trading horizon Embla Medical hf is expected to generate 1.66 times more return on investment than Fundamental Invest. However, Embla Medical is 1.66 times more volatile than Fundamental Invest Stock. It trades about 0.03 of its potential returns per unit of risk. Fundamental Invest Stock is currently generating about -0.02 per unit of risk. If you would invest 3,060 in Embla Medical hf on September 14, 2024 and sell it today you would earn a total of 540.00 from holding Embla Medical hf or generate 17.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Embla Medical hf vs. Fundamental Invest Stock
Performance |
| Timeline |
| Embla Medical hf |
| Fundamental Invest Stock |
Embla Medical and Fundamental Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Embla Medical and Fundamental Invest
The main advantage of trading using opposite Embla Medical and Fundamental Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Embla Medical position performs unexpectedly, Fundamental Invest 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 Fundamental Invest will offset losses from the drop in Fundamental Invest's long position.| Embla Medical vs. Novo Nordisk AS | Embla Medical vs. Nordea Bank Abp | Embla Medical vs. DSV Panalpina AS | Embla Medical vs. AP Mller |
| Fundamental Invest vs. PARKEN Sport Entertainment | Fundamental Invest vs. TROPHY GAMES Development | Fundamental Invest vs. Embla Medical hf | Fundamental Invest vs. Cessatech AS |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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