Correlation Between Target Healthcare and Mynaric AG
Can any of the company-specific risk be diversified away by investing in both Target Healthcare and Mynaric AG 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 Target Healthcare and Mynaric AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Target Healthcare REIT and Mynaric AG, you can compare the effects of market volatilities on Target Healthcare and Mynaric AG 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 Target Healthcare with a short position of Mynaric AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Target Healthcare and Mynaric AG.
Diversification Opportunities for Target Healthcare and Mynaric AG
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Target and Mynaric is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Target Healthcare REIT and Mynaric AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mynaric AG and Target Healthcare 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 Target Healthcare REIT are associated (or correlated) with Mynaric AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mynaric AG has no effect on the direction of Target Healthcare i.e., Target Healthcare and Mynaric AG go up and down completely randomly.
Pair Corralation between Target Healthcare and Mynaric AG
Assuming the 90 days trading horizon Target Healthcare REIT is expected to generate 0.1 times more return on investment than Mynaric AG. However, Target Healthcare REIT is 9.91 times less risky than Mynaric AG. It trades about -0.01 of its potential returns per unit of risk. Mynaric AG is currently generating about -0.11 per unit of risk. If you would invest 8,765 in Target Healthcare REIT on September 13, 2024 and sell it today you would lose (65.00) from holding Target Healthcare REIT or give up 0.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Target Healthcare REIT vs. Mynaric AG
Performance |
| Timeline |
| Target Healthcare REIT |
| Mynaric AG |
Target Healthcare and Mynaric AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Target Healthcare and Mynaric AG
The main advantage of trading using opposite Target Healthcare and Mynaric AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Target Healthcare position performs unexpectedly, Mynaric AG 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 Mynaric AG will offset losses from the drop in Mynaric AG's long position.| Target Healthcare vs. Vulcan Materials Co | Target Healthcare vs. Summit Materials Cl | Target Healthcare vs. Aeorema Communications Plc | Target Healthcare vs. Verizon Communications |
| Mynaric AG vs. Eco Animal Health | Mynaric AG vs. International Biotechnology Trust | Mynaric AG vs. Target Healthcare REIT | Mynaric AG vs. CVS Health Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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