Correlation Between Pacific Hospital and Far EasTone
Can any of the company-specific risk be diversified away by investing in both Pacific Hospital and Far EasTone 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 Pacific Hospital and Far EasTone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pacific Hospital Supply and Far EasTone Telecommunications, you can compare the effects of market volatilities on Pacific Hospital and Far EasTone 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 Pacific Hospital with a short position of Far EasTone. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pacific Hospital and Far EasTone.
Diversification Opportunities for Pacific Hospital and Far EasTone
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pacific and Far is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Pacific Hospital Supply and Far EasTone Telecommunications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Far EasTone Telecomm and Pacific Hospital 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 Pacific Hospital Supply are associated (or correlated) with Far EasTone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Far EasTone Telecomm has no effect on the direction of Pacific Hospital i.e., Pacific Hospital and Far EasTone go up and down completely randomly.
Pair Corralation between Pacific Hospital and Far EasTone
Assuming the 90 days trading horizon Pacific Hospital Supply is expected to under-perform the Far EasTone. But the stock apears to be less risky and, when comparing its historical volatility, Pacific Hospital Supply is 1.41 times less risky than Far EasTone. The stock trades about -0.36 of its potential returns per unit of risk. The Far EasTone Telecommunications is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 8,980 in Far EasTone Telecommunications on November 28, 2024 and sell it today you would earn a total of 0.00 from holding Far EasTone Telecommunications or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pacific Hospital Supply vs. Far EasTone Telecommunications
Performance |
| Timeline |
| Pacific Hospital Supply |
| Far EasTone Telecomm |
Pacific Hospital and Far EasTone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pacific Hospital and Far EasTone
The main advantage of trading using opposite Pacific Hospital and Far EasTone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pacific Hospital position performs unexpectedly, Far EasTone 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 Far EasTone will offset losses from the drop in Far EasTone's long position.| Pacific Hospital vs. StShine Optical Co | Pacific Hospital vs. Bioteque | Pacific Hospital vs. United Orthopedic | Pacific Hospital vs. TTY Biopharm Co |
| Far EasTone vs. Taiwan Mobile Co | Far EasTone vs. Chunghwa Telecom Co | Far EasTone vs. President Chain Store | Far EasTone vs. Formosa Petrochemical Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |