Correlation Between Infinitt Healthcare and Formetal
Can any of the company-specific risk be diversified away by investing in both Infinitt Healthcare and Formetal 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 Infinitt Healthcare and Formetal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infinitt Healthcare Co and Formetal Co, you can compare the effects of market volatilities on Infinitt Healthcare and Formetal 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 Infinitt Healthcare with a short position of Formetal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinitt Healthcare and Formetal.
Diversification Opportunities for Infinitt Healthcare and Formetal
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Infinitt and Formetal is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Infinitt Healthcare Co and Formetal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Formetal and Infinitt Healthcare 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 Infinitt Healthcare Co are associated (or correlated) with Formetal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Formetal has no effect on the direction of Infinitt Healthcare i.e., Infinitt Healthcare and Formetal go up and down completely randomly.
Pair Corralation between Infinitt Healthcare and Formetal
Assuming the 90 days trading horizon Infinitt Healthcare Co is expected to generate 0.38 times more return on investment than Formetal. However, Infinitt Healthcare Co is 2.62 times less risky than Formetal. It trades about 0.12 of its potential returns per unit of risk. Formetal Co is currently generating about 0.0 per unit of risk. If you would invest 426,500 in Infinitt Healthcare Co on November 18, 2024 and sell it today you would earn a total of 16,000 from holding Infinitt Healthcare Co or generate 3.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Infinitt Healthcare Co vs. Formetal Co
Performance |
| Timeline |
| Infinitt Healthcare |
| Formetal |
Infinitt Healthcare and Formetal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinitt Healthcare and Formetal
The main advantage of trading using opposite Infinitt Healthcare and Formetal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinitt Healthcare position performs unexpectedly, Formetal 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 Formetal will offset losses from the drop in Formetal's long position.| Infinitt Healthcare vs. Dongil Metal Co | Infinitt Healthcare vs. Chorokbaem Healthcare Co | Infinitt Healthcare vs. LG Household Healthcare | Infinitt Healthcare vs. Kukil Metal Co |
| Formetal vs. Rainbow Robotics | Formetal vs. COWINTECH Co | Formetal vs. Seoam Machinery Industry | Formetal vs. Busan Industrial Co |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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