Correlation Between Cardinal Health and Asiamet Resources
Can any of the company-specific risk be diversified away by investing in both Cardinal Health and Asiamet Resources 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 Cardinal Health and Asiamet Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Health and Asiamet Resources Limited, you can compare the effects of market volatilities on Cardinal Health and Asiamet Resources 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 Cardinal Health with a short position of Asiamet Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Health and Asiamet Resources.
Diversification Opportunities for Cardinal Health and Asiamet Resources
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cardinal and Asiamet is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Health and Asiamet Resources Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiamet Resources and Cardinal Health 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 Cardinal Health are associated (or correlated) with Asiamet Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiamet Resources has no effect on the direction of Cardinal Health i.e., Cardinal Health and Asiamet Resources go up and down completely randomly.
Pair Corralation between Cardinal Health and Asiamet Resources
Assuming the 90 days trading horizon Cardinal Health is expected to under-perform the Asiamet Resources. But the stock apears to be less risky and, when comparing its historical volatility, Cardinal Health is 4.69 times less risky than Asiamet Resources. The stock trades about -0.2 of its potential returns per unit of risk. The Asiamet Resources Limited is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 68.00 in Asiamet Resources Limited on September 13, 2024 and sell it today you would earn a total of 17.00 from holding Asiamet Resources Limited or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cardinal Health vs. Asiamet Resources Limited
Performance |
| Timeline |
| Cardinal Health |
| Asiamet Resources |
Cardinal Health and Asiamet Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Health and Asiamet Resources
The main advantage of trading using opposite Cardinal Health and Asiamet Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Health position performs unexpectedly, Asiamet Resources 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 Asiamet Resources will offset losses from the drop in Asiamet Resources' long position.| Cardinal Health vs. MT Bank Corp | Cardinal Health vs. Associated British Foods | Cardinal Health vs. Verizon Communications | Cardinal Health vs. Supermarket Income REIT |
| Asiamet Resources vs. Silvercorp Metals | Asiamet Resources vs. GreenX Metals | Asiamet Resources vs. Panther Metals PLC | Asiamet Resources vs. European Metals 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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