Correlation Between Ping An and Healthequity
Can any of the company-specific risk be diversified away by investing in both Ping An and Healthequity 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 Ping An and Healthequity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ping An Healthcare and Healthequity, you can compare the effects of market volatilities on Ping An and Healthequity 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 Ping An with a short position of Healthequity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Healthequity.
Diversification Opportunities for Ping An and Healthequity
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ping and Healthequity is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Healthcare and Healthequity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthequity and Ping An 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 Ping An Healthcare are associated (or correlated) with Healthequity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthequity has no effect on the direction of Ping An i.e., Ping An and Healthequity go up and down completely randomly.
Pair Corralation between Ping An and Healthequity
Assuming the 90 days horizon Ping An Healthcare is expected to generate 1.51 times more return on investment than Healthequity. However, Ping An is 1.51 times more volatile than Healthequity. It trades about 0.19 of its potential returns per unit of risk. Healthequity is currently generating about 0.27 per unit of risk. If you would invest 142.00 in Ping An Healthcare on August 29, 2024 and sell it today you would earn a total of 30.00 from holding Ping An Healthcare or generate 21.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Healthcare vs. Healthequity
Performance |
| Timeline |
| Ping An Healthcare |
| Healthequity |
Ping An and Healthequity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Healthequity
The main advantage of trading using opposite Ping An and Healthequity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Healthequity 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 Healthequity will offset losses from the drop in Healthequity's long position.| Ping An vs. Evolent Health | Ping An vs. CompuGroup Medical SE | Ping An vs. Compugroup Medical SE | Ping An vs. Superior Plus Corp |
| Healthequity vs. ARDAGH METAL PACDL 0001 | Healthequity vs. QINGCI GAMES INC | Healthequity vs. PENN NATL GAMING | Healthequity vs. Japan Tobacco |
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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