Correlation Between Southern Cross and EMvision Medical
Can any of the company-specific risk be diversified away by investing in both Southern Cross and EMvision 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 Southern Cross and EMvision Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Southern Cross Media and EMvision Medical Devices, you can compare the effects of market volatilities on Southern Cross and EMvision 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 Southern Cross with a short position of EMvision Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern Cross and EMvision Medical.
Diversification Opportunities for Southern Cross and EMvision Medical
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Southern and EMvision is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Southern Cross Media and EMvision Medical Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMvision Medical Devices and Southern Cross 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 Southern Cross Media are associated (or correlated) with EMvision Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMvision Medical Devices has no effect on the direction of Southern Cross i.e., Southern Cross and EMvision Medical go up and down completely randomly.
Pair Corralation between Southern Cross and EMvision Medical
Assuming the 90 days trading horizon Southern Cross is expected to generate 1.16 times less return on investment than EMvision Medical. In addition to that, Southern Cross is 1.31 times more volatile than EMvision Medical Devices. It trades about 0.05 of its total potential returns per unit of risk. EMvision Medical Devices is currently generating about 0.08 per unit of volatility. If you would invest 185.00 in EMvision Medical Devices on October 30, 2024 and sell it today you would earn a total of 4.00 from holding EMvision Medical Devices or generate 2.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Southern Cross Media vs. EMvision Medical Devices
Performance |
| Timeline |
| Southern Cross Media |
| EMvision Medical Devices |
Southern Cross and EMvision Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Southern Cross and EMvision Medical
The main advantage of trading using opposite Southern Cross and EMvision Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern Cross position performs unexpectedly, EMvision 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 EMvision Medical will offset losses from the drop in EMvision Medical's long position.| Southern Cross vs. Farm Pride Foods | Southern Cross vs. Data3 | Southern Cross vs. Beston Global Food | Southern Cross vs. AiMedia Technologies |
| EMvision Medical vs. Dexus Convenience Retail | EMvision Medical vs. Retail Food Group | EMvision Medical vs. Hutchison Telecommunications | EMvision Medical vs. Regis Healthcare |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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