Correlation Between Sofwave Medical and Gamatronic Electronic
Can any of the company-specific risk be diversified away by investing in both Sofwave Medical and Gamatronic Electronic 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 Sofwave Medical and Gamatronic Electronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sofwave Medical and Gamatronic Electronic Industries, you can compare the effects of market volatilities on Sofwave Medical and Gamatronic Electronic 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 Sofwave Medical with a short position of Gamatronic Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sofwave Medical and Gamatronic Electronic.
Diversification Opportunities for Sofwave Medical and Gamatronic Electronic
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sofwave and Gamatronic is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Sofwave Medical and Gamatronic Electronic Industri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamatronic Electronic and Sofwave Medical 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 Sofwave Medical are associated (or correlated) with Gamatronic Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamatronic Electronic has no effect on the direction of Sofwave Medical i.e., Sofwave Medical and Gamatronic Electronic go up and down completely randomly.
Pair Corralation between Sofwave Medical and Gamatronic Electronic
Assuming the 90 days trading horizon Sofwave Medical is expected to under-perform the Gamatronic Electronic. But the stock apears to be less risky and, when comparing its historical volatility, Sofwave Medical is 2.77 times less risky than Gamatronic Electronic. The stock trades about -0.09 of its potential returns per unit of risk. The Gamatronic Electronic Industries is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 91,150 in Gamatronic Electronic Industries on September 13, 2024 and sell it today you would earn a total of 39,950 from holding Gamatronic Electronic Industries or generate 43.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sofwave Medical vs. Gamatronic Electronic Industri
Performance |
| Timeline |
| Sofwave Medical |
| Gamatronic Electronic |
Sofwave Medical and Gamatronic Electronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sofwave Medical and Gamatronic Electronic
The main advantage of trading using opposite Sofwave Medical and Gamatronic Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sofwave Medical position performs unexpectedly, Gamatronic Electronic 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 Gamatronic Electronic will offset losses from the drop in Gamatronic Electronic's long position.| Sofwave Medical vs. Intercure | Sofwave Medical vs. Epitomee Medical | Sofwave Medical vs. Bio View | Sofwave Medical vs. Insuline Medical |
| Gamatronic Electronic vs. Ram On Investments and | Gamatronic Electronic vs. Retailors | Gamatronic Electronic vs. Multi Retail Group | Gamatronic Electronic vs. IBI Mutual Funds |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |