Correlation Between Delta Electronics and CompuGroup Medical
Can any of the company-specific risk be diversified away by investing in both Delta Electronics 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 Delta Electronics and CompuGroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Electronics Public and CompuGroup Medical SE, you can compare the effects of market volatilities on Delta Electronics 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 Delta Electronics with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Electronics and CompuGroup Medical.
Diversification Opportunities for Delta Electronics and CompuGroup Medical
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Delta and CompuGroup is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Delta Electronics Public and CompuGroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and Delta Electronics 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 Delta Electronics Public 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 Delta Electronics i.e., Delta Electronics and CompuGroup Medical go up and down completely randomly.
Pair Corralation between Delta Electronics and CompuGroup Medical
Assuming the 90 days trading horizon Delta Electronics Public is expected to generate 0.86 times more return on investment than CompuGroup Medical. However, Delta Electronics Public is 1.17 times less risky than CompuGroup Medical. It trades about 0.15 of its potential returns per unit of risk. CompuGroup Medical SE is currently generating about 0.1 per unit of risk. If you would invest 244.00 in Delta Electronics Public on October 26, 2024 and sell it today you would earn a total of 158.00 from holding Delta Electronics Public or generate 64.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delta Electronics Public vs. CompuGroup Medical SE
Performance |
| Timeline |
| Delta Electronics Public |
| CompuGroup Medical |
Delta Electronics and CompuGroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Electronics and CompuGroup Medical
The main advantage of trading using opposite Delta Electronics and CompuGroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Electronics 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.| Delta Electronics vs. Harmony Gold Mining | Delta Electronics vs. STGEORGE MINING LTD | Delta Electronics vs. Marie Brizard Wine | Delta Electronics vs. De Grey Mining |
| CompuGroup Medical vs. Easy Software AG | CompuGroup Medical vs. Axway Software SA | CompuGroup Medical vs. FORMPIPE SOFTWARE AB | CompuGroup Medical vs. Southwest Airlines Co |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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