Correlation Between Hengkang Medical and Xian International
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By analyzing existing cross correlation between Hengkang Medical Group and Xian International Medical, you can compare the effects of market volatilities on Hengkang Medical and Xian International 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 Hengkang Medical with a short position of Xian International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengkang Medical and Xian International.
Diversification Opportunities for Hengkang Medical and Xian International
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hengkang and Xian is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Hengkang Medical Group and Xian International Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xian International and Hengkang 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 Hengkang Medical Group are associated (or correlated) with Xian International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xian International has no effect on the direction of Hengkang Medical i.e., Hengkang Medical and Xian International go up and down completely randomly.
Pair Corralation between Hengkang Medical and Xian International
Assuming the 90 days trading horizon Hengkang Medical is expected to generate 2.27 times less return on investment than Xian International. But when comparing it to its historical volatility, Hengkang Medical Group is 1.29 times less risky than Xian International. It trades about 0.11 of its potential returns per unit of risk. Xian International Medical is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 484.00 in Xian International Medical on December 11, 2024 and sell it today you would earn a total of 125.00 from holding Xian International Medical or generate 25.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengkang Medical Group vs. Xian International Medical
Performance |
| Timeline |
| Hengkang Medical |
| Xian International |
Hengkang Medical and Xian International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengkang Medical and Xian International
The main advantage of trading using opposite Hengkang Medical and Xian International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengkang Medical position performs unexpectedly, Xian International 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 Xian International will offset losses from the drop in Xian International's long position.| Hengkang Medical vs. Hua Xia Bank | Hengkang Medical vs. Winner Information Technology | Hengkang Medical vs. Kunshan Dongwei Technology | Hengkang Medical vs. HeNan Splendor Science |
| Xian International vs. Montage Technology Co | Xian International vs. iSoftStone Information Technology | Xian International vs. Iat Automobile Technology | Xian International vs. Huaibei Mining Holdings |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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