Correlation Between Innovative Medical and China Asset
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By analyzing existing cross correlation between Innovative Medical Management and China Asset Management, you can compare the effects of market volatilities on Innovative Medical and China Asset 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 China Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovative Medical and China Asset.
Diversification Opportunities for Innovative Medical and China Asset
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Innovative and China is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Medical Management and China Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Asset Management 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 China Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Asset Management has no effect on the direction of Innovative Medical i.e., Innovative Medical and China Asset go up and down completely randomly.
Pair Corralation between Innovative Medical and China Asset
Assuming the 90 days trading horizon Innovative Medical is expected to generate 2.92 times less return on investment than China Asset. In addition to that, Innovative Medical is 3.8 times more volatile than China Asset Management. It trades about 0.04 of its total potential returns per unit of risk. China Asset Management is currently generating about 0.43 per unit of volatility. If you would invest 316.00 in China Asset Management on September 28, 2024 and sell it today you would earn a total of 39.00 from holding China Asset Management or generate 12.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovative Medical Management vs. China Asset Management
Performance |
| Timeline |
| Innovative Medical |
| China Asset Management |
Innovative Medical and China Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovative Medical and China Asset
The main advantage of trading using opposite Innovative Medical and China Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovative Medical position performs unexpectedly, China Asset 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 China Asset will offset losses from the drop in China Asset's long position.| Innovative Medical vs. BYD Co Ltd | Innovative Medical vs. China Mobile Limited | Innovative Medical vs. Agricultural Bank of | Innovative Medical vs. Industrial and Commercial |
| China Asset vs. Industrial and Commercial | China Asset vs. Kweichow Moutai Co | China Asset vs. Agricultural Bank of | China Asset vs. China Mobile Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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