Correlation Between Fresenius Medical and Amplify Online
Can any of the company-specific risk be diversified away by investing in both Fresenius Medical and Amplify Online 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 Fresenius Medical and Amplify Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresenius Medical Care and Amplify Online Retail, you can compare the effects of market volatilities on Fresenius Medical and Amplify Online 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 Fresenius Medical with a short position of Amplify Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresenius Medical and Amplify Online.
Diversification Opportunities for Fresenius Medical and Amplify Online
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fresenius and Amplify is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Fresenius Medical Care and Amplify Online Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amplify Online Retail and Fresenius 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 Fresenius Medical Care are associated (or correlated) with Amplify Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amplify Online Retail has no effect on the direction of Fresenius Medical i.e., Fresenius Medical and Amplify Online go up and down completely randomly.
Pair Corralation between Fresenius Medical and Amplify Online
Considering the 90-day investment horizon Fresenius Medical is expected to generate 1.61 times less return on investment than Amplify Online. In addition to that, Fresenius Medical is 1.43 times more volatile than Amplify Online Retail. It trades about 0.04 of its total potential returns per unit of risk. Amplify Online Retail is currently generating about 0.09 per unit of volatility. If you would invest 5,086 in Amplify Online Retail on September 4, 2024 and sell it today you would earn a total of 1,776 from holding Amplify Online Retail or generate 34.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fresenius Medical Care vs. Amplify Online Retail
Performance |
| Timeline |
| Fresenius Medical Care |
| Amplify Online Retail |
Fresenius Medical and Amplify Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresenius Medical and Amplify Online
The main advantage of trading using opposite Fresenius Medical and Amplify Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresenius Medical position performs unexpectedly, Amplify Online 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 Amplify Online will offset losses from the drop in Amplify Online's long position.| Fresenius Medical vs. Universal Health Services | Fresenius Medical vs. Addus HomeCare | Fresenius Medical vs. HCA Holdings | Fresenius Medical vs. Tenet Healthcare |
| Amplify Online vs. Smith Nephew SNATS | Amplify Online vs. Fresenius Medical Care | Amplify Online vs. Fomento Economico Mexicano | Amplify Online vs. The Cooper Companies, |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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