Correlation Between Repro Med and Industria

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

By analyzing existing cross correlation between Repro Med Systems and Industria de Diseno, you can compare the effects of market volatilities on Repro Med and Industria 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 Repro Med with a short position of Industria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Repro Med and Industria.

Diversification Opportunities for Repro Med and Industria

-0.56

Correlation Coefficient

Repro Med  Industria

Excellent diversification

The 3 months correlation between Repro and Industria is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Repro Med Systems and Industria de Diseno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industria de Diseno and Repro Med 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 Repro Med Systems are associated (or correlated) with Industria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industria de Diseno has no effect on the direction of Repro Med i.e., Repro Med and Industria go up and down completely randomly.

Pair Corralation between Repro Med and Industria

Given the investment horizon of 90 days Repro Med Systems is expected to generate 2.71 times more return on investment than Industria. However, Repro Med is 2.71 times more volatile than Industria de Diseno. It trades about 0.09 of its potential returns per unit of risk. Industria de Diseno is currently generating about -0.15 per unit of risk. If you would invest  366.00  in Repro Med Systems on September 24, 2024 and sell it today you would earn a total of  29.00  from holding Repro Med Systems or generate 7.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Repro Med Systems  vs.  Industria de Diseno

Repro Med Systems

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Repro Med Systems are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, Repro Med exhibited solid returns over the last few months and may actually be approaching a breakup point.

Industria de Diseno

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Industria de Diseno has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Repro Med and Industria

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

The idea behind Repro Med Systems and Industria de Diseno 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.