Correlation Between Marchex and CompuGroup Medical
Can any of the company-specific risk be diversified away by investing in both Marchex and CompuGroup 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 Marchex and CompuGroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marchex and CompuGroup Medical SE, you can compare the effects of market volatilities on Marchex and CompuGroup 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 Marchex with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marchex and CompuGroup Medical.
Diversification Opportunities for Marchex and CompuGroup Medical
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Marchex and CompuGroup is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Marchex and CompuGroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and Marchex 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 Marchex are associated (or correlated) with CompuGroup Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CompuGroup Medical has no effect on the direction of Marchex i.e., Marchex and CompuGroup Medical go up and down completely randomly.
Pair Corralation between Marchex and CompuGroup Medical
Given the investment horizon of 90 days Marchex is expected to generate 3.73 times less return on investment than CompuGroup Medical. But when comparing it to its historical volatility, Marchex is 2.88 times less risky than CompuGroup Medical. It trades about 0.16 of its potential returns per unit of risk. CompuGroup Medical SE is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 1,804 in CompuGroup Medical SE on November 3, 2024 and sell it today you would earn a total of 571.00 from holding CompuGroup Medical SE or generate 31.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Marchex vs. CompuGroup Medical SE
Performance |
| Timeline |
| Marchex |
| CompuGroup Medical |
Marchex and CompuGroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marchex and CompuGroup Medical
The main advantage of trading using opposite Marchex and CompuGroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marchex position performs unexpectedly, CompuGroup 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 CompuGroup Medical will offset losses from the drop in CompuGroup Medical's long position.| Marchex vs. Entravision Communications | Marchex vs. Direct Digital Holdings | Marchex vs. Cimpress NV | Marchex vs. Townsquare Media |
| CompuGroup Medical vs. Olympic Steel | CompuGroup Medical vs. BBB Foods | CompuGroup Medical vs. Weyco Group | CompuGroup Medical vs. Weibo Corp |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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