Correlation Between Adgar Investments and Seach Medical

Can any of the company-specific risk be diversified away by investing in both Adgar Investments and Seach 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 Adgar Investments and Seach Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Adgar Investments and and Seach Medical Group, you can compare the effects of market volatilities on Adgar Investments and Seach 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 Adgar Investments with a short position of Seach Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adgar Investments and Seach Medical.

Diversification Opportunities for Adgar Investments and Seach Medical

0.91

Correlation Coefficient

Adgar Investments  Seach Medical

Almost no diversification

The 3 months correlation between Adgar and Seach is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Adgar Investments and and Seach Medical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seach Medical Group and Adgar Investments 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 Adgar Investments and are associated (or correlated) with Seach Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seach Medical Group has no effect on the direction of Adgar Investments i.e., Adgar Investments and Seach Medical go up and down completely randomly.

Pair Corralation between Adgar Investments and Seach Medical

Assuming the 90 days trading horizon Adgar Investments and is expected to under-perform the Seach Medical. But the stock apears to be less risky and, when comparing its historical volatility, Adgar Investments and is 1.7 times less risky than Seach Medical. The stock trades about -0.2 of its potential returns per unit of risk. The Seach Medical Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  31,080  in Seach Medical Group on October 23, 2024 and sell it today you would earn a total of  390.00  from holding Seach Medical Group or generate 1.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	94.12%
Values	Daily Returns

Adgar Investments and  vs.  Seach Medical Group

Adgar Investments

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Adgar Investments and are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Adgar Investments sustained solid returns over the last few months and may actually be approaching a breakup point.

Seach Medical Group

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Seach Medical Group are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Seach Medical sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Adgar Investments and Seach Medical

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

The idea behind Adgar Investments and and Seach Medical Group 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.