Correlation Between Episurf Medical and SpectraCure
Can any of the company-specific risk be diversified away by investing in both Episurf Medical and SpectraCure 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 SpectraCure 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 SpectraCure AB, you can compare the effects of market volatilities on Episurf Medical and SpectraCure 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 SpectraCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Episurf Medical and SpectraCure.
Diversification Opportunities for Episurf Medical and SpectraCure
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Episurf and SpectraCure is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Episurf Medical AB and SpectraCure AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SpectraCure AB 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 SpectraCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SpectraCure AB has no effect on the direction of Episurf Medical i.e., Episurf Medical and SpectraCure go up and down completely randomly.
Pair Corralation between Episurf Medical and SpectraCure
Assuming the 90 days trading horizon Episurf Medical AB is expected to generate 0.89 times more return on investment than SpectraCure. However, Episurf Medical AB is 1.12 times less risky than SpectraCure. It trades about 0.09 of its potential returns per unit of risk. SpectraCure AB is currently generating about -0.12 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 Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Episurf Medical AB vs. SpectraCure AB
Performance |
| Timeline |
| Episurf Medical AB |
| SpectraCure AB |
Episurf Medical and SpectraCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Episurf Medical and SpectraCure
The main advantage of trading using opposite Episurf Medical and SpectraCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Episurf Medical position performs unexpectedly, SpectraCure 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 SpectraCure will offset losses from the drop in SpectraCure'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 |
| SpectraCure vs. Maha Energy AB | SpectraCure vs. Saniona AB | SpectraCure vs. Kancera AB | SpectraCure vs. SolTech Energy Sweden |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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