Correlation Between Integrated Diagnostics and In Style

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

By analyzing existing cross correlation between Integrated Diagnostics Holdings and in Style Group, you can compare the effects of market volatilities on Integrated Diagnostics and In Style 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 Integrated Diagnostics with a short position of In Style. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integrated Diagnostics and In Style.

Diversification Opportunities for Integrated Diagnostics and In Style

-0.48

Correlation Coefficient

Integrated Diagnostics  In Style

Very good diversification

The 3 months correlation between Integrated and ITS is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Integrated Diagnostics Holding and in Style Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on in Style Group and Integrated Diagnostics 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 Integrated Diagnostics Holdings are associated (or correlated) with In Style. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of in Style Group has no effect on the direction of Integrated Diagnostics i.e., Integrated Diagnostics and In Style go up and down completely randomly.

Pair Corralation between Integrated Diagnostics and In Style

Assuming the 90 days trading horizon Integrated Diagnostics Holdings is expected to generate 2.4 times more return on investment than In Style. However, Integrated Diagnostics is 2.4 times more volatile than in Style Group. It trades about 0.15 of its potential returns per unit of risk. in Style Group is currently generating about 0.1 per unit of risk. If you would invest  40.00  in Integrated Diagnostics Holdings on September 25, 2024 and sell it today you would earn a total of  4.00  from holding Integrated Diagnostics Holdings or generate 10.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.45%
Values	Daily Returns

Integrated Diagnostics Holding  vs.  in Style Group

Integrated Diagnostics

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Integrated Diagnostics Holdings are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Integrated Diagnostics unveiled solid returns over the last few months and may actually be approaching a breakup point.

in Style Group

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in in Style Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, In Style is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Integrated Diagnostics and In Style

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

The idea behind Integrated Diagnostics Holdings and in Style 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.