Correlation Between Veeva Systems and Compugroup Medical
Can any of the company-specific risk be diversified away by investing in both Veeva Systems and Compugroup 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 Veeva Systems and Compugroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Veeva Systems and Compugroup Medical SE, you can compare the effects of market volatilities on Veeva Systems and Compugroup 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 Veeva Systems with a short position of Compugroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veeva Systems and Compugroup Medical.
Diversification Opportunities for Veeva Systems and Compugroup Medical
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Veeva and Compugroup is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Veeva Systems and Compugroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compugroup Medical and Veeva Systems 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 Veeva Systems are associated (or correlated) with Compugroup Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compugroup Medical has no effect on the direction of Veeva Systems i.e., Veeva Systems and Compugroup Medical go up and down completely randomly.
Pair Corralation between Veeva Systems and Compugroup Medical
Assuming the 90 days horizon Veeva Systems is expected to generate 0.72 times more return on investment than Compugroup Medical. However, Veeva Systems is 1.4 times less risky than Compugroup Medical. It trades about 0.04 of its potential returns per unit of risk. Compugroup Medical SE is currently generating about -0.03 per unit of risk. If you would invest 16,430 in Veeva Systems on December 10, 2024 and sell it today you would earn a total of 4,990 from holding Veeva Systems or generate 30.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Veeva Systems vs. Compugroup Medical SE
Performance |
| Timeline |
| Veeva Systems |
| Compugroup Medical |
Veeva Systems and Compugroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Veeva Systems and Compugroup Medical
The main advantage of trading using opposite Veeva Systems and Compugroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veeva Systems position performs unexpectedly, Compugroup 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 Compugroup Medical will offset losses from the drop in Compugroup Medical's long position.| Veeva Systems vs. RESMINING UNSPADR10 | Veeva Systems vs. New Residential Investment | Veeva Systems vs. Diversified Healthcare Trust | Veeva Systems vs. JLF INVESTMENT |
| Compugroup Medical vs. YATRA ONLINE DL 0001 | Compugroup Medical vs. Nomad Foods | Compugroup Medical vs. Suntory Beverage Food | Compugroup Medical vs. AUSNUTRIA DAIRY |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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