Correlation Between Fitipower Integrated and MedFirst Healthcare

Can any of the company-specific risk be diversified away by investing in both Fitipower Integrated and MedFirst Healthcare 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 Fitipower Integrated and MedFirst Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fitipower Integrated Technology and MedFirst Healthcare Services, you can compare the effects of market volatilities on Fitipower Integrated and MedFirst Healthcare 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 Fitipower Integrated with a short position of MedFirst Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fitipower Integrated and MedFirst Healthcare.

Diversification Opportunities for Fitipower Integrated and MedFirst Healthcare

0.78

Correlation Coefficient

Fitipower Integrated  MedFirst Healthcare

Poor diversification

The 3 months correlation between Fitipower and MedFirst is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Fitipower Integrated Technolog and MedFirst Healthcare Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MedFirst Healthcare and Fitipower Integrated 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 Fitipower Integrated Technology are associated (or correlated) with MedFirst Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MedFirst Healthcare has no effect on the direction of Fitipower Integrated i.e., Fitipower Integrated and MedFirst Healthcare go up and down completely randomly.

Pair Corralation between Fitipower Integrated and MedFirst Healthcare

Assuming the 90 days trading horizon Fitipower Integrated Technology is expected to under-perform the MedFirst Healthcare. In addition to that, Fitipower Integrated is 2.4 times more volatile than MedFirst Healthcare Services. It trades about -0.19 of its total potential returns per unit of risk. MedFirst Healthcare Services is currently generating about -0.19 per unit of volatility. If you would invest  7,010  in MedFirst Healthcare Services on September 25, 2024 and sell it today you would lose (460.00) from holding MedFirst Healthcare Services or give up 6.56% of portfolio value over 90 days.

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

Fitipower Integrated Technolog  vs.  MedFirst Healthcare Services

Fitipower Integrated

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fitipower Integrated Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

MedFirst Healthcare

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MedFirst Healthcare Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with Fitipower Integrated and MedFirst Healthcare

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

The idea behind Fitipower Integrated Technology and MedFirst Healthcare Services 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.