Correlation Between Easy Software and CompuGroup Medical
Can any of the company-specific risk be diversified away by investing in both Easy Software and CompuGroup Medical 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 Easy Software and CompuGroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Easy Software AG and CompuGroup Medical SE, you can compare the effects of market volatilities on Easy Software and CompuGroup Medical 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 Easy Software with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Easy Software and CompuGroup Medical.
Diversification Opportunities for Easy Software and CompuGroup Medical
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Easy and CompuGroup is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Easy Software AG and CompuGroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and Easy Software 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 Easy Software AG are associated (or correlated) with CompuGroup Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CompuGroup Medical has no effect on the direction of Easy Software i.e., Easy Software and CompuGroup Medical go up and down completely randomly.
Pair Corralation between Easy Software and CompuGroup Medical
Assuming the 90 days trading horizon Easy Software AG is expected to under-perform the CompuGroup Medical. In addition to that, Easy Software is 5.17 times more volatile than CompuGroup Medical SE. It trades about -0.06 of its total potential returns per unit of risk. CompuGroup Medical SE is currently generating about 0.37 per unit of volatility. If you would invest 2,176 in CompuGroup Medical SE on October 26, 2024 and sell it today you would earn a total of 104.00 from holding CompuGroup Medical SE or generate 4.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Easy Software AG vs. CompuGroup Medical SE
Performance |
| Timeline |
| Easy Software AG |
| CompuGroup Medical |
Easy Software and CompuGroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Easy Software and CompuGroup Medical
The main advantage of trading using opposite Easy Software and CompuGroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Easy Software position performs unexpectedly, CompuGroup Medical 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 CompuGroup Medical will offset losses from the drop in CompuGroup Medical's long position.| Easy Software vs. Salesforce | Easy Software vs. Uber Technologies | Easy Software vs. PagerDuty | Easy Software vs. Rocket Internet SE |
| CompuGroup Medical vs. Easy Software AG | CompuGroup Medical vs. Axway Software SA | CompuGroup Medical vs. FORMPIPE SOFTWARE AB | CompuGroup Medical vs. Southwest Airlines Co |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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