Correlation Between Futura Medical and Elmos Semiconductor
Can any of the company-specific risk be diversified away by investing in both Futura Medical and Elmos Semiconductor 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 Futura Medical and Elmos Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Futura Medical and Elmos Semiconductor SE, you can compare the effects of market volatilities on Futura Medical and Elmos Semiconductor 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 Futura Medical with a short position of Elmos Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Futura Medical and Elmos Semiconductor.
Diversification Opportunities for Futura Medical and Elmos Semiconductor
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Futura and Elmos is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Futura Medical and Elmos Semiconductor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elmos Semiconductor and Futura 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 Futura Medical are associated (or correlated) with Elmos Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elmos Semiconductor has no effect on the direction of Futura Medical i.e., Futura Medical and Elmos Semiconductor go up and down completely randomly.
Pair Corralation between Futura Medical and Elmos Semiconductor
Assuming the 90 days trading horizon Futura Medical is expected to under-perform the Elmos Semiconductor. In addition to that, Futura Medical is 1.56 times more volatile than Elmos Semiconductor SE. It trades about -0.05 of its total potential returns per unit of risk. Elmos Semiconductor SE is currently generating about 0.03 per unit of volatility. If you would invest 6,553 in Elmos Semiconductor SE on November 4, 2024 and sell it today you would earn a total of 542.00 from holding Elmos Semiconductor SE or generate 8.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Futura Medical vs. Elmos Semiconductor SE
Performance |
| Timeline |
| Futura Medical |
| Elmos Semiconductor |
Futura Medical and Elmos Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Futura Medical and Elmos Semiconductor
The main advantage of trading using opposite Futura Medical and Elmos Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Futura Medical position performs unexpectedly, Elmos Semiconductor 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 Elmos Semiconductor will offset losses from the drop in Elmos Semiconductor's long position.| Futura Medical vs. Bisichi Mining PLC | Futura Medical vs. Atalaya Mining | Futura Medical vs. Griffin Mining | Futura Medical vs. Fortuna Silver Mines |
| Elmos Semiconductor vs. Bankers Investment Trust | Elmos Semiconductor vs. Ecofin Global Utilities | Elmos Semiconductor vs. Kinnevik Investment AB | Elmos Semiconductor vs. Lindsell Train Investment |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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