Correlation Between Sharps Technology and ConvaTec Group
Can any of the company-specific risk be diversified away by investing in both Sharps Technology and ConvaTec Group 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 Sharps Technology and ConvaTec Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sharps Technology and ConvaTec Group Plc, you can compare the effects of market volatilities on Sharps Technology and ConvaTec Group 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 Sharps Technology with a short position of ConvaTec Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sharps Technology and ConvaTec Group.
Diversification Opportunities for Sharps Technology and ConvaTec Group
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sharps and ConvaTec is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Sharps Technology and ConvaTec Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ConvaTec Group Plc and Sharps Technology 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 Sharps Technology are associated (or correlated) with ConvaTec Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ConvaTec Group Plc has no effect on the direction of Sharps Technology i.e., Sharps Technology and ConvaTec Group go up and down completely randomly.
Pair Corralation between Sharps Technology and ConvaTec Group
Given the investment horizon of 90 days Sharps Technology is expected to generate 0.93 times more return on investment than ConvaTec Group. However, Sharps Technology is 1.08 times less risky than ConvaTec Group. It trades about 0.23 of its potential returns per unit of risk. ConvaTec Group Plc is currently generating about 0.09 per unit of risk. If you would invest 290.00 in Sharps Technology on September 1, 2024 and sell it today you would earn a total of 86.00 from holding Sharps Technology or generate 29.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Sharps Technology vs. ConvaTec Group Plc
Performance |
| Timeline |
| Sharps Technology |
| ConvaTec Group Plc |
Sharps Technology and ConvaTec Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sharps Technology and ConvaTec Group
The main advantage of trading using opposite Sharps Technology and ConvaTec Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sharps Technology position performs unexpectedly, ConvaTec Group 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 ConvaTec Group will offset losses from the drop in ConvaTec Group's long position.| Sharps Technology vs. JIN MEDICAL INTERNATIONAL | Sharps Technology vs. Meihua International Medical | Sharps Technology vs. GlucoTrack | Sharps Technology vs. Innovative Eyewear |
| ConvaTec Group vs. Usio Inc | ConvaTec Group vs. Analog Devices | ConvaTec Group vs. Q2 Holdings | ConvaTec Group vs. Evertz Technologies Limited |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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