Correlation Between Medical Properties and Paysafe

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

By analyzing existing cross correlation between Medical Properties Trust and Paysafe Ltd Wt, you can compare the effects of market volatilities on Medical Properties and Paysafe 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 Medical Properties with a short position of Paysafe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medical Properties and Paysafe.

Diversification Opportunities for Medical Properties and Paysafe

-0.78

Correlation Coefficient

Medical Properties  Paysafe

Pay attention - limited upside

The 3 months correlation between Medical and Paysafe is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Medical Properties Trust and Paysafe Ltd Wt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paysafe Ltd Wt and Medical Properties 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 Medical Properties Trust are associated (or correlated) with Paysafe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paysafe Ltd Wt has no effect on the direction of Medical Properties i.e., Medical Properties and Paysafe go up and down completely randomly.

Pair Corralation between Medical Properties and Paysafe

Considering the 90-day investment horizon Medical Properties Trust is expected to generate 0.41 times more return on investment than Paysafe. However, Medical Properties Trust is 2.46 times less risky than Paysafe. It trades about 0.26 of its potential returns per unit of risk. Paysafe Ltd Wt is currently generating about -0.05 per unit of risk. If you would invest  367.00  in Medical Properties Trust on December 30, 2024 and sell it today you would earn a total of  237.00  from holding Medical Properties Trust or generate 64.58% return on investment over 90 days.

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

Medical Properties Trust  vs.  Paysafe Ltd Wt

Medical Properties Trust

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Medical Properties Trust are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Medical Properties showed solid returns over the last few months and may actually be approaching a breakup point.

Paysafe Ltd Wt

Risk-Adjusted Performance

Very Weak

Over the last 90 days Paysafe Ltd Wt has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Medical Properties and Paysafe

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

The idea behind Medical Properties Trust and Paysafe Ltd Wt 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.