Correlation Between Metalurgica Gerdau and HCA Healthcare,

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

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

Diversification Opportunities for Metalurgica Gerdau and HCA Healthcare,

-0.53

Correlation Coefficient

Metalurgica Gerdau  HCA Healthcare,

Excellent diversification

The 3 months correlation between Metalurgica and HCA is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Metalurgica Gerdau SA and HCA Healthcare, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HCA Healthcare, and Metalurgica Gerdau 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 Metalurgica Gerdau SA are associated (or correlated) with HCA Healthcare,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HCA Healthcare, has no effect on the direction of Metalurgica Gerdau i.e., Metalurgica Gerdau and HCA Healthcare, go up and down completely randomly.

Pair Corralation between Metalurgica Gerdau and HCA Healthcare,

Assuming the 90 days trading horizon Metalurgica Gerdau SA is expected to under-perform the HCA Healthcare,. In addition to that, Metalurgica Gerdau is 1.21 times more volatile than HCA Healthcare,. It trades about -0.19 of its total potential returns per unit of risk. HCA Healthcare, is currently generating about -0.17 per unit of volatility. If you would invest  9,936  in HCA Healthcare, on October 7, 2024 and sell it today you would lose (946.00) from holding HCA Healthcare, or give up 9.52% of portfolio value over 90 days.

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

Metalurgica Gerdau SA  vs.  HCA Healthcare,

Metalurgica Gerdau

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Metalurgica Gerdau SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Preferred Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

HCA Healthcare,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days HCA Healthcare, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Metalurgica Gerdau and HCA Healthcare,

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

The idea behind Metalurgica Gerdau SA and HCA Healthcare, 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.