Correlation Between Hospital Mater and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both Hospital Mater and Electronic Arts 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 Hospital Mater and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hospital Mater Dei and Electronic Arts, you can compare the effects of market volatilities on Hospital Mater and Electronic Arts 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 Hospital Mater with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hospital Mater and Electronic Arts.
Diversification Opportunities for Hospital Mater and Electronic Arts
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hospital and Electronic is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Hospital Mater Dei and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Hospital Mater 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 Hospital Mater Dei are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Hospital Mater i.e., Hospital Mater and Electronic Arts go up and down completely randomly.
Pair Corralation between Hospital Mater and Electronic Arts
Assuming the 90 days trading horizon Hospital Mater Dei is expected to under-perform the Electronic Arts. In addition to that, Hospital Mater is 1.58 times more volatile than Electronic Arts. It trades about -0.05 of its total potential returns per unit of risk. Electronic Arts is currently generating about 0.04 per unit of volatility. If you would invest 32,550 in Electronic Arts on October 15, 2024 and sell it today you would earn a total of 10,922 from holding Electronic Arts or generate 33.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.59% |
| Values | Daily Returns |
Hospital Mater Dei vs. Electronic Arts
Performance |
| Timeline |
| Hospital Mater Dei |
| Electronic Arts |
Hospital Mater and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hospital Mater and Electronic Arts
The main advantage of trading using opposite Hospital Mater and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hospital Mater position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| Hospital Mater vs. United States Steel | Hospital Mater vs. United Natural Foods, | Hospital Mater vs. Bemobi Mobile Tech | Hospital Mater vs. Zoom Video Communications |
| Electronic Arts vs. Mitsubishi UFJ Financial | Electronic Arts vs. KB Financial Group | Electronic Arts vs. Bread Financial Holdings | Electronic Arts 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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