Correlation Between Double Medical and CareRay Digital
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By analyzing existing cross correlation between Double Medical Technology and CareRay Digital Medical, you can compare the effects of market volatilities on Double Medical and CareRay Digital 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 Double Medical with a short position of CareRay Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Double Medical and CareRay Digital.
Diversification Opportunities for Double Medical and CareRay Digital
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Double and CareRay is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Double Medical Technology and CareRay Digital Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareRay Digital Medical and Double 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 Double Medical Technology are associated (or correlated) with CareRay Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareRay Digital Medical has no effect on the direction of Double Medical i.e., Double Medical and CareRay Digital go up and down completely randomly.
Pair Corralation between Double Medical and CareRay Digital
Assuming the 90 days trading horizon Double Medical Technology is expected to under-perform the CareRay Digital. But the stock apears to be less risky and, when comparing its historical volatility, Double Medical Technology is 1.44 times less risky than CareRay Digital. The stock trades about -0.17 of its potential returns per unit of risk. The CareRay Digital Medical is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,588 in CareRay Digital Medical on September 13, 2024 and sell it today you would earn a total of 4.00 from holding CareRay Digital Medical or generate 0.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Double Medical Technology vs. CareRay Digital Medical
Performance |
| Timeline |
| Double Medical Technology |
| CareRay Digital Medical |
Double Medical and CareRay Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Double Medical and CareRay Digital
The main advantage of trading using opposite Double Medical and CareRay Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Double Medical position performs unexpectedly, CareRay Digital 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 CareRay Digital will offset losses from the drop in CareRay Digital's long position.| Double Medical vs. Industrial and Commercial | Double Medical vs. Kweichow Moutai Co | Double Medical vs. Agricultural Bank of | Double Medical vs. China Mobile Limited |
| CareRay Digital vs. Industrial and Commercial | CareRay Digital vs. Kweichow Moutai Co | CareRay Digital vs. Agricultural Bank of | CareRay Digital 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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