Correlation Between Methanor and Amplitude Surgical

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

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

Diversification Opportunities for Methanor and Amplitude Surgical

-0.38

Correlation Coefficient

Methanor  Amplitude Surgical

Very good diversification

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

Pair Corralation between Methanor and Amplitude Surgical

Assuming the 90 days trading horizon Methanor is expected to under-perform the Amplitude Surgical. In addition to that, Methanor is 1.61 times more volatile than Amplitude Surgical SAS. It trades about -0.14 of its total potential returns per unit of risk. Amplitude Surgical SAS is currently generating about -0.08 per unit of volatility. If you would invest  324.00  in Amplitude Surgical SAS on September 27, 2024 and sell it today you would lose (12.00) from holding Amplitude Surgical SAS or give up 3.7% of portfolio value over 90 days.

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

Methanor  vs.  Amplitude Surgical SAS

Methanor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Methanor has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Amplitude Surgical SAS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amplitude Surgical SAS has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Amplitude Surgical is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Methanor and Amplitude Surgical

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

The idea behind Methanor and Amplitude Surgical SAS 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.