Correlation Between Mednax and Retractable Technologies
Can any of the company-specific risk be diversified away by investing in both Mednax and Retractable Technologies 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 Mednax and Retractable Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mednax Inc and Retractable Technologies, you can compare the effects of market volatilities on Mednax and Retractable Technologies 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 Mednax with a short position of Retractable Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mednax and Retractable Technologies.
Diversification Opportunities for Mednax and Retractable Technologies
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mednax and Retractable is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Mednax Inc and Retractable Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retractable Technologies and Mednax 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 Mednax Inc are associated (or correlated) with Retractable Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retractable Technologies has no effect on the direction of Mednax i.e., Mednax and Retractable Technologies go up and down completely randomly.
Pair Corralation between Mednax and Retractable Technologies
Allowing for the 90-day total investment horizon Mednax Inc is expected to generate 1.18 times more return on investment than Retractable Technologies. However, Mednax is 1.18 times more volatile than Retractable Technologies. It trades about 0.08 of its potential returns per unit of risk. Retractable Technologies is currently generating about -0.07 per unit of risk. If you would invest 934.00 in Mednax Inc on September 2, 2024 and sell it today you would earn a total of 562.00 from holding Mednax Inc or generate 60.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mednax Inc vs. Retractable Technologies
Performance |
| Timeline |
| Mednax Inc |
| Retractable Technologies |
Mednax and Retractable Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mednax and Retractable Technologies
The main advantage of trading using opposite Mednax and Retractable Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mednax position performs unexpectedly, Retractable Technologies 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 Retractable Technologies will offset losses from the drop in Retractable Technologies' long position.| Mednax vs. Acadia Healthcare | Mednax vs. Select Medical Holdings | Mednax vs. Universal Health Services | Mednax vs. Prestige Brand Holdings |
| Retractable Technologies vs. Milestone Scientific | Retractable Technologies vs. CarPartsCom | Retractable Technologies vs. OncoCyte Corp | Retractable Technologies vs. Alpha Pro Tech |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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