Correlation Between Medicalg and X Trade

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

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

Diversification Opportunities for Medicalg and X Trade

-0.67

Correlation Coefficient

Medicalg  X Trade

Excellent diversification

The 3 months correlation between Medicalg and XTB is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Medicalg and X Trade Brokers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on X Trade Brokers and Medicalg 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 Medicalg are associated (or correlated) with X Trade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of X Trade Brokers has no effect on the direction of Medicalg i.e., Medicalg and X Trade go up and down completely randomly.

Pair Corralation between Medicalg and X Trade

Assuming the 90 days trading horizon Medicalg is expected to generate 1.61 times more return on investment than X Trade. However, Medicalg is 1.61 times more volatile than X Trade Brokers. It trades about 0.22 of its potential returns per unit of risk. X Trade Brokers is currently generating about -0.02 per unit of risk. If you would invest  1,679  in Medicalg on December 22, 2024 and sell it today you would earn a total of  1,017  from holding Medicalg or generate 60.57% return on investment over 90 days.

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

Medicalg  vs.  X Trade Brokers

Medicalg

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Medicalg are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Medicalg reported solid returns over the last few months and may actually be approaching a breakup point.

X Trade Brokers

Risk-Adjusted Performance

Very Weak

Over the last 90 days X Trade Brokers has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, X Trade is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Medicalg and X Trade

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

The idea behind Medicalg and X Trade Brokers 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.