Correlation Between Liontrust Asset and Fresenius Medical
Can any of the company-specific risk be diversified away by investing in both Liontrust Asset and Fresenius 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 Liontrust Asset and Fresenius Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liontrust Asset Management and Fresenius Medical Care, you can compare the effects of market volatilities on Liontrust Asset and Fresenius 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 Liontrust Asset with a short position of Fresenius Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liontrust Asset and Fresenius Medical.
Diversification Opportunities for Liontrust Asset and Fresenius Medical
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Liontrust and Fresenius is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Liontrust Asset Management and Fresenius Medical Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fresenius Medical Care and Liontrust Asset 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 Liontrust Asset Management are associated (or correlated) with Fresenius Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fresenius Medical Care has no effect on the direction of Liontrust Asset i.e., Liontrust Asset and Fresenius Medical go up and down completely randomly.
Pair Corralation between Liontrust Asset and Fresenius Medical
Assuming the 90 days trading horizon Liontrust Asset Management is expected to under-perform the Fresenius Medical. In addition to that, Liontrust Asset is 2.18 times more volatile than Fresenius Medical Care. It trades about -0.07 of its total potential returns per unit of risk. Fresenius Medical Care is currently generating about 0.28 per unit of volatility. If you would invest 4,425 in Fresenius Medical Care on November 6, 2024 and sell it today you would earn a total of 347.00 from holding Fresenius Medical Care or generate 7.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liontrust Asset Management vs. Fresenius Medical Care
Performance |
| Timeline |
| Liontrust Asset Mana |
| Fresenius Medical Care |
Liontrust Asset and Fresenius Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liontrust Asset and Fresenius Medical
The main advantage of trading using opposite Liontrust Asset and Fresenius Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liontrust Asset position performs unexpectedly, Fresenius 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 Fresenius Medical will offset losses from the drop in Fresenius Medical's long position.| Liontrust Asset vs. Software Circle plc | Liontrust Asset vs. DXC Technology Co | Liontrust Asset vs. Pressure Technologies Plc | Liontrust Asset vs. Bytes Technology |
| Fresenius Medical vs. UNIQA Insurance Group | Fresenius Medical vs. Ondine Biomedical | Fresenius Medical vs. Raymond James Financial | Fresenius Medical vs. Synchrony Financial |
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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