Correlation Between Multilaser Industrial and Hospital Mater
Can any of the company-specific risk be diversified away by investing in both Multilaser Industrial and Hospital Mater 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 Multilaser Industrial and Hospital Mater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multilaser Industrial SA and Hospital Mater Dei, you can compare the effects of market volatilities on Multilaser Industrial and Hospital Mater 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 Multilaser Industrial with a short position of Hospital Mater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multilaser Industrial and Hospital Mater.
Diversification Opportunities for Multilaser Industrial and Hospital Mater
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Multilaser and Hospital is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Multilaser Industrial SA and Hospital Mater Dei in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hospital Mater Dei and Multilaser Industrial 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 Multilaser Industrial SA are associated (or correlated) with Hospital Mater. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hospital Mater Dei has no effect on the direction of Multilaser Industrial i.e., Multilaser Industrial and Hospital Mater go up and down completely randomly.
Pair Corralation between Multilaser Industrial and Hospital Mater
Assuming the 90 days trading horizon Multilaser Industrial SA is expected to under-perform the Hospital Mater. In addition to that, Multilaser Industrial is 1.53 times more volatile than Hospital Mater Dei. It trades about -0.2 of its total potential returns per unit of risk. Hospital Mater Dei is currently generating about -0.13 per unit of volatility. If you would invest 460.00 in Hospital Mater Dei on September 5, 2024 and sell it today you would lose (56.00) from holding Hospital Mater Dei or give up 12.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multilaser Industrial SA vs. Hospital Mater Dei
Performance |
| Timeline |
| Multilaser Industrial |
| Hospital Mater Dei |
Multilaser Industrial and Hospital Mater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multilaser Industrial and Hospital Mater
The main advantage of trading using opposite Multilaser Industrial and Hospital Mater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multilaser Industrial position performs unexpectedly, Hospital Mater 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 Hospital Mater will offset losses from the drop in Hospital Mater's long position.| Multilaser Industrial vs. Intelbras SA | Multilaser Industrial vs. Pet Center Comrcio | Multilaser Industrial vs. Locaweb Servios de | Multilaser Industrial vs. Mliuz SA |
| Hospital Mater vs. Fundo Investimento Imobiliario | Hospital Mater vs. Fras le SA | Hospital Mater vs. Western Digital | Hospital Mater vs. Clave Indices De |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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