Correlation Between Innovative Medical and BYD Co

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Innovative Medical and BYD Co 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 Innovative Medical and BYD Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovative Medical Management and BYD Co Ltd, you can compare the effects of market volatilities on Innovative Medical and BYD Co 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 Innovative Medical with a short position of BYD Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Medical and BYD Co.

Diversification Opportunities for Innovative Medical and BYD Co

-0.26
  Correlation Coefficient

Very good diversification

The 3 months correlation between Innovative and BYD is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Medical Management and BYD Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BYD Co and Innovative 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 Innovative Medical Management are associated (or correlated) with BYD Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BYD Co has no effect on the direction of Innovative Medical i.e., Innovative Medical and BYD Co go up and down completely randomly.

Pair Corralation between Innovative Medical and BYD Co

Assuming the 90 days trading horizon Innovative Medical Management is expected to generate 1.86 times more return on investment than BYD Co. However, Innovative Medical is 1.86 times more volatile than BYD Co Ltd. It trades about 0.03 of its potential returns per unit of risk. BYD Co Ltd is currently generating about 0.01 per unit of risk. If you would invest  713.00  in Innovative Medical Management on October 16, 2024 and sell it today you would earn a total of  125.00  from holding Innovative Medical Management or generate 17.53% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Innovative Medical Management  vs.  BYD Co Ltd

 Performance 
       Timeline  
Innovative Medical 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Innovative Medical Management are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Innovative Medical sustained solid returns over the last few months and may actually be approaching a breakup point.
BYD Co 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days BYD Co Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Innovative Medical and BYD Co Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Innovative Medical and BYD Co

The main advantage of trading using opposite Innovative Medical and BYD Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Medical position performs unexpectedly, BYD Co 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 BYD Co will offset losses from the drop in BYD Co's long position.
Innovative Medical vs. Southern PublishingMedia Co
Innovative Medical vs. Jiangsu Jinling Sports
Innovative Medical vs. Caihong Display Devices
Innovative Medical vs. Beijing Enlight Media
The idea behind Innovative Medical Management and BYD Co Ltd 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.
BYD Co vs. Guangdong Qunxing Toys
BYD Co vs. Innovative Medical Management
BYD Co vs. Kingclean Electric Co
BYD Co vs. Guangzhou Restaurants Group
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

Other Complementary Tools

Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Fundamental Analysis
View fundamental data based on most recent published financial statements
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio


 
Macroaxis helps investors of all levels and skills to maximize the upside of all their holdings and minimize the risk associated with market volatility, economic swings, and company-specific events. View terms and conditions
 
Feedback Blog
Made with optimal in San Francisco
2024 Macroaxis LLC
COMMON DESTINATIONS
MAIN CATEGORIES
COMPANY