Correlation Between PARKEN Sport and Medical Properties

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

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

Diversification Opportunities for PARKEN Sport and Medical Properties

-0.62

Correlation Coefficient

PARKEN Sport  Medical Properties

Excellent diversification

The 3 months correlation between PARKEN and Medical is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and Medical Properties Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medical Properties Trust and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with Medical Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medical Properties Trust has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and Medical Properties go up and down completely randomly.

Pair Corralation between PARKEN Sport and Medical Properties

Assuming the 90 days horizon PARKEN Sport is expected to generate 1.19 times less return on investment than Medical Properties. But when comparing it to its historical volatility, PARKEN Sport Entertainment is 2.14 times less risky than Medical Properties. It trades about 0.04 of its potential returns per unit of risk. Medical Properties Trust is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  397.00  in Medical Properties Trust on September 3, 2024 and sell it today you would earn a total of  3.00  from holding Medical Properties Trust or generate 0.76% return on investment over 90 days.

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

PARKEN Sport Entertainment  vs.  Medical Properties Trust

PARKEN Sport Enterta

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in PARKEN Sport Entertainment are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, PARKEN Sport is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Medical Properties Trust

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Medical Properties Trust are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Medical Properties may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with PARKEN Sport and Medical Properties

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

The idea behind PARKEN Sport Entertainment and Medical Properties Trust 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.