Correlation Between Medicalg and CD PROJEKT
Can any of the company-specific risk be diversified away by investing in both Medicalg and CD PROJEKT 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 Medicalg and CD PROJEKT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medicalg and CD PROJEKT SA, you can compare the effects of market volatilities on Medicalg and CD PROJEKT 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 Medicalg with a short position of CD PROJEKT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medicalg and CD PROJEKT.
Diversification Opportunities for Medicalg and CD PROJEKT
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Medicalg and CDR is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Medicalg and CD PROJEKT SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CD PROJEKT SA and Medicalg 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 Medicalg are associated (or correlated) with CD PROJEKT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CD PROJEKT SA has no effect on the direction of Medicalg i.e., Medicalg and CD PROJEKT go up and down completely randomly.
Pair Corralation between Medicalg and CD PROJEKT
Assuming the 90 days trading horizon Medicalg is expected to generate 1.8 times more return on investment than CD PROJEKT. However, Medicalg is 1.8 times more volatile than CD PROJEKT SA. It trades about 0.15 of its potential returns per unit of risk. CD PROJEKT SA is currently generating about 0.14 per unit of risk. If you would invest 1,865 in Medicalg on November 4, 2024 and sell it today you would earn a total of 275.00 from holding Medicalg or generate 14.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medicalg vs. CD PROJEKT SA
Performance |
| Timeline |
| Medicalg |
| CD PROJEKT SA |
Medicalg and CD PROJEKT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medicalg and CD PROJEKT
The main advantage of trading using opposite Medicalg and CD PROJEKT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medicalg position performs unexpectedly, CD PROJEKT 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 CD PROJEKT will offset losses from the drop in CD PROJEKT's long position.| Medicalg vs. Adiuvo Investment SA | Medicalg vs. Asseco Business Solutions | Medicalg vs. Detalion Games SA | Medicalg vs. Movie Games SA |
| CD PROJEKT vs. Igoria Trade SA | CD PROJEKT vs. UF Games SA | CD PROJEKT vs. Drago entertainment SA | CD PROJEKT vs. Skyline Investment SA |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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