Correlation Between Tehmag Foods and SS Healthcare
Can any of the company-specific risk be diversified away by investing in both Tehmag Foods and SS 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 Tehmag Foods and SS Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tehmag Foods and SS Healthcare Holding, you can compare the effects of market volatilities on Tehmag Foods and SS 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 Tehmag Foods with a short position of SS Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tehmag Foods and SS Healthcare.
Diversification Opportunities for Tehmag Foods and SS Healthcare
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tehmag and 4198 is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Tehmag Foods and SS Healthcare Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SS Healthcare Holding and Tehmag Foods 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 Tehmag Foods are associated (or correlated) with SS Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SS Healthcare Holding has no effect on the direction of Tehmag Foods i.e., Tehmag Foods and SS Healthcare go up and down completely randomly.
Pair Corralation between Tehmag Foods and SS Healthcare
Assuming the 90 days trading horizon Tehmag Foods is expected to generate 0.17 times more return on investment than SS Healthcare. However, Tehmag Foods is 6.05 times less risky than SS Healthcare. It trades about 0.34 of its potential returns per unit of risk. SS Healthcare Holding is currently generating about -0.13 per unit of risk. If you would invest 31,000 in Tehmag Foods on November 3, 2024 and sell it today you would earn a total of 800.00 from holding Tehmag Foods or generate 2.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tehmag Foods vs. SS Healthcare Holding
Performance |
| Timeline |
| Tehmag Foods |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| SS Healthcare Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tehmag Foods and SS Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tehmag Foods and SS Healthcare
The main advantage of trading using opposite Tehmag Foods and SS Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tehmag Foods position performs unexpectedly, SS 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 SS Healthcare will offset losses from the drop in SS Healthcare's long position.The idea behind Tehmag Foods and SS Healthcare Holding pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |