Correlation Between CREO MEDICAL and International Consolidated

Can any of the company-specific risk be diversified away by investing in both CREO MEDICAL and International Consolidated 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 CREO MEDICAL and International Consolidated into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CREO MEDICAL GRP and International Consolidated Airlines, you can compare the effects of market volatilities on CREO MEDICAL and International Consolidated 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 CREO MEDICAL with a short position of International Consolidated. Check out your portfolio center. Please also check ongoing floating volatility patterns of CREO MEDICAL and International Consolidated.

Diversification Opportunities for CREO MEDICAL and International Consolidated

0.38

Correlation Coefficient

CREO MEDICAL  International Consolidated

Weak diversification

The 3 months correlation between CREO and International is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding CREO MEDICAL GRP and International Consolidated Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Consolidated and CREO MEDICAL 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 CREO MEDICAL GRP are associated (or correlated) with International Consolidated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Consolidated has no effect on the direction of CREO MEDICAL i.e., CREO MEDICAL and International Consolidated go up and down completely randomly.

Pair Corralation between CREO MEDICAL and International Consolidated

Assuming the 90 days horizon CREO MEDICAL GRP is expected to under-perform the International Consolidated. In addition to that, CREO MEDICAL is 1.63 times more volatile than International Consolidated Airlines. It trades about -0.11 of its total potential returns per unit of risk. International Consolidated Airlines is currently generating about -0.02 per unit of volatility. If you would invest  362.00  in International Consolidated Airlines on December 24, 2024 and sell it today you would lose (20.00) from holding International Consolidated Airlines or give up 5.52% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

CREO MEDICAL GRP  vs.  International Consolidated Air

CREO MEDICAL GRP

Risk-Adjusted Performance

Very Weak

Over the last 90 days CREO MEDICAL GRP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

International Consolidated

Risk-Adjusted Performance

Very Weak

Over the last 90 days International Consolidated Airlines has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, International Consolidated is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CREO MEDICAL and International Consolidated

The main advantage of trading using opposite CREO MEDICAL and International Consolidated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CREO MEDICAL position performs unexpectedly, International Consolidated 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 International Consolidated will offset losses from the drop in International Consolidated's long position.

The idea behind CREO MEDICAL GRP and International Consolidated Airlines pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.