Correlation Between Mediantechn and Maat Pharma

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

By analyzing existing cross correlation between Mediantechn and Maat Pharma SA, you can compare the effects of market volatilities on Mediantechn and Maat Pharma 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 Mediantechn with a short position of Maat Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mediantechn and Maat Pharma.

Diversification Opportunities for Mediantechn and Maat Pharma

-0.04

Correlation Coefficient

Mediantechn  Maat Pharma

Good diversification

The 3 months correlation between Mediantechn and Maat is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Mediantechn and Maat Pharma SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maat Pharma SA and Mediantechn 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 Mediantechn are associated (or correlated) with Maat Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maat Pharma SA has no effect on the direction of Mediantechn i.e., Mediantechn and Maat Pharma go up and down completely randomly.

Pair Corralation between Mediantechn and Maat Pharma

Assuming the 90 days trading horizon Mediantechn is expected to generate 1.13 times more return on investment than Maat Pharma. However, Mediantechn is 1.13 times more volatile than Maat Pharma SA. It trades about 0.27 of its potential returns per unit of risk. Maat Pharma SA is currently generating about 0.02 per unit of risk. If you would invest  378.00  in Mediantechn on October 15, 2024 and sell it today you would earn a total of  98.00  from holding Mediantechn or generate 25.93% return on investment over 90 days.

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

Mediantechn  vs.  Maat Pharma SA

Mediantechn

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mediantechn are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Mediantechn reported solid returns over the last few months and may actually be approaching a breakup point.

Maat Pharma SA

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Maat Pharma SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Maat Pharma may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Mediantechn and Maat Pharma

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

The idea behind Mediantechn and Maat Pharma SA 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.