Correlation Between Western Metal and Dezhan HealthCare
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By analyzing existing cross correlation between Western Metal Materials and Dezhan HealthCare Co, you can compare the effects of market volatilities on Western Metal and Dezhan HealthCare 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 Western Metal with a short position of Dezhan HealthCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Dezhan HealthCare.
Diversification Opportunities for Western Metal and Dezhan HealthCare
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Western and Dezhan is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Dezhan HealthCare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dezhan HealthCare and Western Metal 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 Western Metal Materials are associated (or correlated) with Dezhan HealthCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dezhan HealthCare has no effect on the direction of Western Metal i.e., Western Metal and Dezhan HealthCare go up and down completely randomly.
Pair Corralation between Western Metal and Dezhan HealthCare
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 0.91 times more return on investment than Dezhan HealthCare. However, Western Metal Materials is 1.1 times less risky than Dezhan HealthCare. It trades about 0.02 of its potential returns per unit of risk. Dezhan HealthCare Co is currently generating about 0.0 per unit of risk. If you would invest 1,478 in Western Metal Materials on September 3, 2024 and sell it today you would earn a total of 138.00 from holding Western Metal Materials or generate 9.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Dezhan HealthCare Co
Performance |
| Timeline |
| Western Metal Materials |
| Dezhan HealthCare |
Western Metal and Dezhan HealthCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Dezhan HealthCare
The main advantage of trading using opposite Western Metal and Dezhan HealthCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Dezhan HealthCare 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 Dezhan HealthCare will offset losses from the drop in Dezhan HealthCare's long position.| Western Metal vs. Haima Automobile Group | Western Metal vs. FSPG Hi Tech Co | Western Metal vs. Tianjin Hi Tech Development | Western Metal vs. Peoples Insurance of |
| Dezhan HealthCare vs. Chengdu Kanghua Biological | Dezhan HealthCare vs. Beijing Wantai Biological | Dezhan HealthCare vs. Suzhou Novoprotein Scientific | Dezhan HealthCare vs. Aluminum Corp of |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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