Correlation Between Edwards Lifesciences and Centogene
Can any of the company-specific risk be diversified away by investing in both Edwards Lifesciences and Centogene 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 Edwards Lifesciences and Centogene into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edwards Lifesciences Corp and Centogene B V, you can compare the effects of market volatilities on Edwards Lifesciences and Centogene 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 Edwards Lifesciences with a short position of Centogene. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edwards Lifesciences and Centogene.
Diversification Opportunities for Edwards Lifesciences and Centogene
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Edwards and Centogene is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Edwards Lifesciences Corp and Centogene B V in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centogene B V and Edwards Lifesciences 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 Edwards Lifesciences Corp are associated (or correlated) with Centogene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centogene B V has no effect on the direction of Edwards Lifesciences i.e., Edwards Lifesciences and Centogene go up and down completely randomly.
Pair Corralation between Edwards Lifesciences and Centogene
Allowing for the 90-day total investment horizon Edwards Lifesciences is expected to generate 4.09 times less return on investment than Centogene. But when comparing it to its historical volatility, Edwards Lifesciences Corp is 4.48 times less risky than Centogene. It trades about 0.09 of its potential returns per unit of risk. Centogene B V is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Centogene B V on November 28, 2024 and sell it today you would earn a total of 1.03 from holding Centogene B V or generate 7.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Edwards Lifesciences Corp vs. Centogene B V
Performance |
| Timeline |
| Edwards Lifesciences Corp |
| Centogene B V |
Edwards Lifesciences and Centogene Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edwards Lifesciences and Centogene
The main advantage of trading using opposite Edwards Lifesciences and Centogene positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edwards Lifesciences position performs unexpectedly, Centogene 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 Centogene will offset losses from the drop in Centogene's long position.| Edwards Lifesciences vs. Medtronic PLC | Edwards Lifesciences vs. Abbott Laboratories | Edwards Lifesciences vs. Boston Scientific Corp | Edwards Lifesciences vs. Zimmer Biomet Holdings |
| Centogene vs. Fonar | Centogene vs. Exagen Inc | Centogene vs. Sera Prognostics | Centogene vs. Sotera Health 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |