Correlation Between Atos SE and Medincell

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

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

Diversification Opportunities for Atos SE and Medincell

-0.7

Correlation Coefficient

Atos SE  Medincell

Excellent diversification

The 3 months correlation between Atos and Medincell is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Atos SE and Medincell SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medincell SA and Atos SE 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 Atos SE are associated (or correlated) with Medincell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medincell SA has no effect on the direction of Atos SE i.e., Atos SE and Medincell go up and down completely randomly.

Pair Corralation between Atos SE and Medincell

Assuming the 90 days trading horizon Atos SE is expected to generate 2.53 times more return on investment than Medincell. However, Atos SE is 2.53 times more volatile than Medincell SA. It trades about 0.14 of its potential returns per unit of risk. Medincell SA is currently generating about -0.06 per unit of risk. If you would invest  0.25  in Atos SE on December 30, 2024 and sell it today you would earn a total of  0.15  from holding Atos SE or generate 60.0% return on investment over 90 days.

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

Atos SE  vs.  Medincell SA

Atos SE

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Atos SE are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Atos SE sustained solid returns over the last few months and may actually be approaching a breakup point.

Medincell SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Medincell SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Atos SE and Medincell

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

The idea behind Atos SE and Medincell 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.