Correlation Between Medicure and Creative Edge

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

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

Diversification Opportunities for Medicure and Creative Edge

0.0

Correlation Coefficient

Medicure  Creative Edge

Pay attention - limited upside

The 3 months correlation between Medicure and Creative is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Medicure and Creative Edge Nutrit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Creative Edge Nutrit and Medicure 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 Medicure are associated (or correlated) with Creative Edge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Creative Edge Nutrit has no effect on the direction of Medicure i.e., Medicure and Creative Edge go up and down completely randomly.

Pair Corralation between Medicure and Creative Edge

If you would invest  63.00  in Medicure on September 5, 2024 and sell it today you would earn a total of  7.00  from holding Medicure or generate 11.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Medicure  vs.  Creative Edge Nutrit

Medicure

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Medicure has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward-looking indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Creative Edge Nutrit

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Creative Edge Nutrit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Creative Edge is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Medicure and Creative Edge

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

The idea behind Medicure and Creative Edge Nutrit 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.