Correlation Between Take Two and Hospital Mater
Can any of the company-specific risk be diversified away by investing in both Take Two 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 Take Two and Hospital Mater into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Take Two Interactive Software and Hospital Mater Dei, you can compare the effects of market volatilities on Take Two 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 Take Two with a short position of Hospital Mater. Check out your portfolio center. Please also check ongoing floating volatility patterns of Take Two and Hospital Mater.
Diversification Opportunities for Take Two and Hospital Mater
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Take and Hospital is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Take Two Interactive Software 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 Take Two 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 Take Two Interactive Software 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 Take Two i.e., Take Two and Hospital Mater go up and down completely randomly.
Pair Corralation between Take Two and Hospital Mater
Assuming the 90 days trading horizon Take Two Interactive Software is expected to generate 0.78 times more return on investment than Hospital Mater. However, Take Two Interactive Software is 1.28 times less risky than Hospital Mater. It trades about 0.06 of its potential returns per unit of risk. Hospital Mater Dei is currently generating about -0.07 per unit of risk. If you would invest 21,050 in Take Two Interactive Software on November 3, 2024 and sell it today you would earn a total of 6,178 from holding Take Two Interactive Software or generate 29.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Take Two Interactive Software vs. Hospital Mater Dei
Performance |
| Timeline |
| Take Two Interactive |
| Hospital Mater Dei |
Take Two and Hospital Mater Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Take Two and Hospital Mater
The main advantage of trading using opposite Take Two and Hospital Mater positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Take Two 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.| Take Two vs. Universal Health Services, | Take Two vs. UnitedHealth Group Incorporated | Take Two vs. The Hartford Financial | Take Two vs. Chunghwa Telecom Co, |
| Hospital Mater vs. Clover Health Investments, | Hospital Mater vs. T Mobile | Hospital Mater vs. Bemobi Mobile Tech | Hospital Mater vs. United Rentals |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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