Correlation Between TRI CHEMICAL and CompuGroup Medical

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

By analyzing existing cross correlation between TRI CHEMICAL LABORATINC and CompuGroup Medical SE, you can compare the effects of market volatilities on TRI CHEMICAL and CompuGroup Medical 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 TRI CHEMICAL with a short position of CompuGroup Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRI CHEMICAL and CompuGroup Medical.

Diversification Opportunities for TRI CHEMICAL and CompuGroup Medical

-0.34

Correlation Coefficient

TRI CHEMICAL  CompuGroup Medical

Very good diversification

The 3 months correlation between TRI and CompuGroup is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding TRI CHEMICAL LABORATINC and CompuGroup Medical SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CompuGroup Medical and TRI CHEMICAL 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 TRI CHEMICAL LABORATINC are associated (or correlated) with CompuGroup Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CompuGroup Medical has no effect on the direction of TRI CHEMICAL i.e., TRI CHEMICAL and CompuGroup Medical go up and down completely randomly.

Pair Corralation between TRI CHEMICAL and CompuGroup Medical

Assuming the 90 days horizon TRI CHEMICAL LABORATINC is expected to generate 4.37 times more return on investment than CompuGroup Medical. However, TRI CHEMICAL is 4.37 times more volatile than CompuGroup Medical SE. It trades about 0.18 of its potential returns per unit of risk. CompuGroup Medical SE is currently generating about 0.13 per unit of risk. If you would invest  1,520  in TRI CHEMICAL LABORATINC on April 24, 2025 and sell it today you would earn a total of  420.00  from holding TRI CHEMICAL LABORATINC or generate 27.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	69.84%
Values	Daily Returns

TRI CHEMICAL LABORATINC  vs.  CompuGroup Medical SE

TRI CHEMICAL LABORATINC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in TRI CHEMICAL LABORATINC are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, TRI CHEMICAL reported solid returns over the last few months and may actually be approaching a breakup point.

CompuGroup Medical

Risk-Adjusted Performance

OK

Over the last 90 days CompuGroup Medical SE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CompuGroup Medical is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with TRI CHEMICAL and CompuGroup Medical

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

The idea behind TRI CHEMICAL LABORATINC and CompuGroup Medical SE 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.