Correlation Between GERATHERM MEDICAL and Amdocs

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

By analyzing existing cross correlation between GERATHERM MEDICAL and Amdocs Limited, you can compare the effects of market volatilities on GERATHERM MEDICAL and Amdocs 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 GERATHERM MEDICAL with a short position of Amdocs. Check out your portfolio center. Please also check ongoing floating volatility patterns of GERATHERM MEDICAL and Amdocs.

Diversification Opportunities for GERATHERM MEDICAL and Amdocs

-0.49

Correlation Coefficient

GERATHERM MEDICAL  Amdocs

Very good diversification

The 3 months correlation between GERATHERM and Amdocs is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding GERATHERM MEDICAL and Amdocs Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amdocs Limited and GERATHERM MEDICAL 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 GERATHERM MEDICAL are associated (or correlated) with Amdocs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amdocs Limited has no effect on the direction of GERATHERM MEDICAL i.e., GERATHERM MEDICAL and Amdocs go up and down completely randomly.

Pair Corralation between GERATHERM MEDICAL and Amdocs

Assuming the 90 days trading horizon GERATHERM MEDICAL is expected to generate 1.39 times more return on investment than Amdocs. However, GERATHERM MEDICAL is 1.39 times more volatile than Amdocs Limited. It trades about 0.02 of its potential returns per unit of risk. Amdocs Limited is currently generating about -0.08 per unit of risk. If you would invest  297.00  in GERATHERM MEDICAL on May 22, 2025 and sell it today you would earn a total of  4.00  from holding GERATHERM MEDICAL or generate 1.35% return on investment over 90 days.

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

GERATHERM MEDICAL  vs.  Amdocs Limited

GERATHERM MEDICAL

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in GERATHERM MEDICAL are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, GERATHERM MEDICAL is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Amdocs Limited

Risk-Adjusted Performance

Weakest

Over the last 90 days Amdocs Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with GERATHERM MEDICAL and Amdocs

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

The idea behind GERATHERM MEDICAL and Amdocs Limited 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.