Correlation Between Dynamic Medical and First Insurance
Can any of the company-specific risk be diversified away by investing in both Dynamic Medical and First Insurance 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 Dynamic Medical and First Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynamic Medical Technologies and First Insurance Co, you can compare the effects of market volatilities on Dynamic Medical and First Insurance 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 Dynamic Medical with a short position of First Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynamic Medical and First Insurance.
Diversification Opportunities for Dynamic Medical and First Insurance
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dynamic and First is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Dynamic Medical Technologies and First Insurance Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Insurance and Dynamic Medical 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 Dynamic Medical Technologies are associated (or correlated) with First Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Insurance has no effect on the direction of Dynamic Medical i.e., Dynamic Medical and First Insurance go up and down completely randomly.
Pair Corralation between Dynamic Medical and First Insurance
Assuming the 90 days trading horizon Dynamic Medical Technologies is expected to generate 0.88 times more return on investment than First Insurance. However, Dynamic Medical Technologies is 1.13 times less risky than First Insurance. It trades about -0.16 of its potential returns per unit of risk. First Insurance Co is currently generating about -0.17 per unit of risk. If you would invest 9,230 in Dynamic Medical Technologies on October 12, 2024 and sell it today you would lose (260.00) from holding Dynamic Medical Technologies or give up 2.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynamic Medical Technologies vs. First Insurance Co
Performance |
| Timeline |
| Dynamic Medical Tech |
| First Insurance |
Dynamic Medical and First Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynamic Medical and First Insurance
The main advantage of trading using opposite Dynamic Medical and First Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynamic Medical position performs unexpectedly, First Insurance 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 First Insurance will offset losses from the drop in First Insurance's long position.| Dynamic Medical vs. Weltrend Semiconductor | Dynamic Medical vs. Sinopower Semiconductor | Dynamic Medical vs. FDC International Hotels | Dynamic Medical vs. Grand Ocean Retail |
| First Insurance vs. EnTie Commercial Bank | First Insurance vs. Union Bank of | First Insurance vs. Bank of Kaohsiung | First Insurance vs. Taiwan Business Bank |
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 Stocks Directory module to find actively traded stocks across global markets.
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