Correlation Between Moelis and 26443CAA1

Can any of the company-specific risk be diversified away by investing in both Moelis and 26443CAA1 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 Moelis and 26443CAA1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Moelis Co and DUKE UNIV HEALTH, you can compare the effects of market volatilities on Moelis and 26443CAA1 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 Moelis with a short position of 26443CAA1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moelis and 26443CAA1.

Diversification Opportunities for Moelis and 26443CAA1

-0.52

Correlation Coefficient

Moelis  26443CAA1

Excellent diversification

The 3 months correlation between Moelis and 26443CAA1 is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Moelis Co and DUKE UNIV HEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DUKE UNIV HEALTH and Moelis 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 Moelis Co are associated (or correlated) with 26443CAA1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DUKE UNIV HEALTH has no effect on the direction of Moelis i.e., Moelis and 26443CAA1 go up and down completely randomly.

Pair Corralation between Moelis and 26443CAA1

Allowing for the 90-day total investment horizon Moelis Co is expected to generate 1.4 times more return on investment than 26443CAA1. However, Moelis is 1.4 times more volatile than DUKE UNIV HEALTH. It trades about -0.06 of its potential returns per unit of risk. DUKE UNIV HEALTH is currently generating about -0.19 per unit of risk. If you would invest  7,800  in Moelis Co on October 10, 2024 and sell it today you would lose (327.00) from holding Moelis Co or give up 4.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	45.0%
Values	Daily Returns

Moelis Co  vs.  DUKE UNIV HEALTH

Moelis

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Moelis Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, Moelis exhibited solid returns over the last few months and may actually be approaching a breakup point.

DUKE UNIV HEALTH

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DUKE UNIV HEALTH has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic 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 DUKE UNIV HEALTH investors.

Pair Trading with Moelis and 26443CAA1

The main advantage of trading using opposite Moelis and 26443CAA1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moelis position performs unexpectedly, 26443CAA1 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 26443CAA1 will offset losses from the drop in 26443CAA1's long position.

The idea behind Moelis Co and DUKE UNIV HEALTH 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.