Correlation Between ViTrox Bhd and IHH Healthcare
Can any of the company-specific risk be diversified away by investing in both ViTrox Bhd and IHH Healthcare 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 ViTrox Bhd and IHH Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ViTrox Bhd and IHH Healthcare Bhd, you can compare the effects of market volatilities on ViTrox Bhd and IHH 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 ViTrox Bhd with a short position of IHH Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of ViTrox Bhd and IHH Healthcare.
Diversification Opportunities for ViTrox Bhd and IHH Healthcare
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ViTrox and IHH is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding ViTrox Bhd and IHH Healthcare Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHH Healthcare Bhd and ViTrox Bhd 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 ViTrox Bhd are associated (or correlated) with IHH Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHH Healthcare Bhd has no effect on the direction of ViTrox Bhd i.e., ViTrox Bhd and IHH Healthcare go up and down completely randomly.
Pair Corralation between ViTrox Bhd and IHH Healthcare
Assuming the 90 days trading horizon ViTrox Bhd is expected to generate 2.51 times more return on investment than IHH Healthcare. However, ViTrox Bhd is 2.51 times more volatile than IHH Healthcare Bhd. It trades about 0.13 of its potential returns per unit of risk. IHH Healthcare Bhd is currently generating about -0.03 per unit of risk. If you would invest 343.00 in ViTrox Bhd on October 20, 2024 and sell it today you would earn a total of 51.00 from holding ViTrox Bhd or generate 14.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ViTrox Bhd vs. IHH Healthcare Bhd
Performance |
| Timeline |
| ViTrox Bhd |
| IHH Healthcare Bhd |
ViTrox Bhd and IHH Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ViTrox Bhd and IHH Healthcare
The main advantage of trading using opposite ViTrox Bhd and IHH Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ViTrox Bhd position performs unexpectedly, IHH 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 IHH Healthcare will offset losses from the drop in IHH Healthcare's long position.| ViTrox Bhd vs. Uchi Technologies Bhd | ViTrox Bhd vs. Sports Toto Berhad | ViTrox Bhd vs. Binasat Communications Bhd | ViTrox Bhd vs. Steel Hawk Berhad |
| IHH Healthcare vs. Mercury Industries Bhd | IHH Healthcare vs. Hong Leong Bank | IHH Healthcare vs. YX Precious Metals | IHH Healthcare vs. Press Metal Bhd |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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