Correlation Between ADDUS HOMECARE and Munters Group
Can any of the company-specific risk be diversified away by investing in both ADDUS HOMECARE and Munters Group 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 ADDUS HOMECARE and Munters Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADDUS HOMECARE and Munters Group AB, you can compare the effects of market volatilities on ADDUS HOMECARE and Munters Group 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 ADDUS HOMECARE with a short position of Munters Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADDUS HOMECARE and Munters Group.
Diversification Opportunities for ADDUS HOMECARE and Munters Group
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ADDUS and Munters is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding ADDUS HOMECARE and Munters Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Munters Group AB and ADDUS HOMECARE 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 ADDUS HOMECARE are associated (or correlated) with Munters Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Munters Group AB has no effect on the direction of ADDUS HOMECARE i.e., ADDUS HOMECARE and Munters Group go up and down completely randomly.
Pair Corralation between ADDUS HOMECARE and Munters Group
Assuming the 90 days trading horizon ADDUS HOMECARE is expected to generate 30.01 times less return on investment than Munters Group. But when comparing it to its historical volatility, ADDUS HOMECARE is 2.92 times less risky than Munters Group. It trades about 0.01 of its potential returns per unit of risk. Munters Group AB is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,162 in Munters Group AB on September 11, 2025 and sell it today you would earn a total of 493.00 from holding Munters Group AB or generate 42.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ADDUS HOMECARE vs. Munters Group AB
Performance |
| Timeline |
| ADDUS HOMECARE |
| Munters Group AB |
ADDUS HOMECARE and Munters Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ADDUS HOMECARE and Munters Group
The main advantage of trading using opposite ADDUS HOMECARE and Munters Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADDUS HOMECARE position performs unexpectedly, Munters Group 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 Munters Group will offset losses from the drop in Munters Group's long position.| ADDUS HOMECARE vs. Strategic Investments AS | ADDUS HOMECARE vs. MGIC INVESTMENT | ADDUS HOMECARE vs. ELECTRONIC ARTS | ADDUS HOMECARE vs. Diversified Healthcare Trust |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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