Correlation Between Zoo Digital and CompuGroup Medical
Can any of the company-specific risk be diversified away by investing in both Zoo Digital 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 Zoo Digital and CompuGroup Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zoo Digital Group and CompuGroup Medical AG, you can compare the effects of market volatilities on Zoo Digital 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 Zoo Digital with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zoo Digital and CompuGroup Medical.
Diversification Opportunities for Zoo Digital and CompuGroup Medical
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Zoo and CompuGroup is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Zoo Digital Group and CompuGroup Medical AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and Zoo Digital 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 Zoo Digital Group 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 Zoo Digital i.e., Zoo Digital and CompuGroup Medical go up and down completely randomly.
Pair Corralation between Zoo Digital and CompuGroup Medical
Assuming the 90 days trading horizon Zoo Digital Group is expected to generate 2.12 times more return on investment than CompuGroup Medical. However, Zoo Digital is 2.12 times more volatile than CompuGroup Medical AG. It trades about -0.03 of its potential returns per unit of risk. CompuGroup Medical AG is currently generating about -0.09 per unit of risk. If you would invest 11,550 in Zoo Digital Group on September 2, 2024 and sell it today you would lose (8,200) from holding Zoo Digital Group or give up 71.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zoo Digital Group vs. CompuGroup Medical AG
Performance |
| Timeline |
| Zoo Digital Group |
| CompuGroup Medical |
Zoo Digital and CompuGroup Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zoo Digital and CompuGroup Medical
The main advantage of trading using opposite Zoo Digital and CompuGroup Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zoo Digital 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.| Zoo Digital vs. SupplyMe Capital PLC | Zoo Digital vs. Lloyds Banking Group | Zoo Digital vs. Premier African Minerals | Zoo Digital vs. SANTANDER UK 8 |
| CompuGroup Medical vs. Uniper SE | CompuGroup Medical vs. Mulberry Group PLC | CompuGroup Medical vs. London Security Plc | CompuGroup Medical vs. Triad Group PLC |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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