Correlation Between Episurf Medical and Corline Biomedical
Can any of the company-specific risk be diversified away by investing in both Episurf Medical and Corline Biomedical 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 Episurf Medical and Corline Biomedical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Episurf Medical AB and Corline Biomedical AB, you can compare the effects of market volatilities on Episurf Medical and Corline Biomedical 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 Episurf Medical with a short position of Corline Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Episurf Medical and Corline Biomedical.
Diversification Opportunities for Episurf Medical and Corline Biomedical
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Episurf and Corline is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Episurf Medical AB and Corline Biomedical AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corline Biomedical and Episurf 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 Episurf Medical AB are associated (or correlated) with Corline Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corline Biomedical has no effect on the direction of Episurf Medical i.e., Episurf Medical and Corline Biomedical go up and down completely randomly.
Pair Corralation between Episurf Medical and Corline Biomedical
Assuming the 90 days trading horizon Episurf Medical AB is expected to generate 1.19 times more return on investment than Corline Biomedical. However, Episurf Medical is 1.19 times more volatile than Corline Biomedical AB. It trades about 0.09 of its potential returns per unit of risk. Corline Biomedical AB is currently generating about -0.11 per unit of risk. If you would invest 13.00 in Episurf Medical AB on September 3, 2024 and sell it today you would earn a total of 2.00 from holding Episurf Medical AB or generate 15.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Episurf Medical AB vs. Corline Biomedical AB
Performance |
| Timeline |
| Episurf Medical AB |
| Corline Biomedical |
Episurf Medical and Corline Biomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Episurf Medical and Corline Biomedical
The main advantage of trading using opposite Episurf Medical and Corline Biomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Episurf Medical position performs unexpectedly, Corline Biomedical 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 Corline Biomedical will offset losses from the drop in Corline Biomedical's long position.| Episurf Medical vs. BioInvent International AB | Episurf Medical vs. Cantargia AB | Episurf Medical vs. Bonesupport Holding AB | Episurf Medical vs. Bactiguard Holding AB |
| Corline Biomedical vs. Simris Alg AB | Corline Biomedical vs. Immunovia publ AB | Corline Biomedical vs. Sedana Medical AB | Corline Biomedical vs. KABE Group AB |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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