Correlation Between Peijia Medical and EMPLOYERS HLDGS
Can any of the company-specific risk be diversified away by investing in both Peijia Medical and EMPLOYERS HLDGS 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 Peijia Medical and EMPLOYERS HLDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peijia Medical Limited and EMPLOYERS HLDGS DL, you can compare the effects of market volatilities on Peijia Medical and EMPLOYERS HLDGS 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 Peijia Medical with a short position of EMPLOYERS HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peijia Medical and EMPLOYERS HLDGS.
Diversification Opportunities for Peijia Medical and EMPLOYERS HLDGS
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Peijia and EMPLOYERS is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Peijia Medical Limited and EMPLOYERS HLDGS DL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMPLOYERS HLDGS DL and Peijia 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 Peijia Medical Limited are associated (or correlated) with EMPLOYERS HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMPLOYERS HLDGS DL has no effect on the direction of Peijia Medical i.e., Peijia Medical and EMPLOYERS HLDGS go up and down completely randomly.
Pair Corralation between Peijia Medical and EMPLOYERS HLDGS
Assuming the 90 days horizon Peijia Medical Limited is expected to generate 3.01 times more return on investment than EMPLOYERS HLDGS. However, Peijia Medical is 3.01 times more volatile than EMPLOYERS HLDGS DL. It trades about -0.02 of its potential returns per unit of risk. EMPLOYERS HLDGS DL is currently generating about -0.07 per unit of risk. If you would invest 46.00 in Peijia Medical Limited on October 19, 2024 and sell it today you would lose (2.00) from holding Peijia Medical Limited or give up 4.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.5% |
| Values | Daily Returns |
Peijia Medical Limited vs. EMPLOYERS HLDGS DL
Performance |
| Timeline |
| Peijia Medical |
| EMPLOYERS HLDGS DL |
Peijia Medical and EMPLOYERS HLDGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peijia Medical and EMPLOYERS HLDGS
The main advantage of trading using opposite Peijia Medical and EMPLOYERS HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peijia Medical position performs unexpectedly, EMPLOYERS HLDGS 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 EMPLOYERS HLDGS will offset losses from the drop in EMPLOYERS HLDGS's long position.| Peijia Medical vs. CN MODERN DAIRY | Peijia Medical vs. AUSNUTRIA DAIRY | Peijia Medical vs. LIFEWAY FOODS | Peijia Medical vs. Thai Beverage Public |
| EMPLOYERS HLDGS vs. PTT Global Chemical | EMPLOYERS HLDGS vs. Genertec Universal Medical | EMPLOYERS HLDGS vs. Peijia Medical Limited | EMPLOYERS HLDGS 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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