Correlation Between Hospital Mater and TC Traders

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

By analyzing existing cross correlation between Hospital Mater Dei and TC Traders Club, you can compare the effects of market volatilities on Hospital Mater and TC Traders 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 Hospital Mater with a short position of TC Traders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hospital Mater and TC Traders.

Diversification Opportunities for Hospital Mater and TC Traders

0.46

Correlation Coefficient

Hospital Mater  TC Traders

Very weak diversification

The 3 months correlation between Hospital and TRAD3 is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hospital Mater Dei and TC Traders Club in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TC Traders Club and Hospital Mater 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 Hospital Mater Dei are associated (or correlated) with TC Traders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TC Traders Club has no effect on the direction of Hospital Mater i.e., Hospital Mater and TC Traders go up and down completely randomly.

Pair Corralation between Hospital Mater and TC Traders

Assuming the 90 days trading horizon Hospital Mater is expected to generate 2.22 times less return on investment than TC Traders. But when comparing it to its historical volatility, Hospital Mater Dei is 1.48 times less risky than TC Traders. It trades about 0.03 of its potential returns per unit of risk. TC Traders Club is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  685.00  in TC Traders Club on April 23, 2025 and sell it today you would earn a total of  45.00  from holding TC Traders Club or generate 6.57% return on investment over 90 days.

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

Hospital Mater Dei  vs.  TC Traders Club

Hospital Mater Dei

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hospital Mater Dei are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Hospital Mater is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

TC Traders Club

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in TC Traders Club are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, TC Traders unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hospital Mater and TC Traders

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

The idea behind Hospital Mater Dei and TC Traders Club 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.

Check out your portfolio center.

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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.