Correlation Between IHH Healthcare and YTL Hospitality
Can any of the company-specific risk be diversified away by investing in both IHH Healthcare and YTL Hospitality 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 IHH Healthcare and YTL Hospitality into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IHH Healthcare Bhd and YTL Hospitality REIT, you can compare the effects of market volatilities on IHH Healthcare and YTL Hospitality 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 IHH Healthcare with a short position of YTL Hospitality. Check out your portfolio center. Please also check ongoing floating volatility patterns of IHH Healthcare and YTL Hospitality.
Diversification Opportunities for IHH Healthcare and YTL Hospitality
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IHH and YTL is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding IHH Healthcare Bhd and YTL Hospitality REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YTL Hospitality REIT and IHH Healthcare 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 IHH Healthcare Bhd are associated (or correlated) with YTL Hospitality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YTL Hospitality REIT has no effect on the direction of IHH Healthcare i.e., IHH Healthcare and YTL Hospitality go up and down completely randomly.
Pair Corralation between IHH Healthcare and YTL Hospitality
Assuming the 90 days trading horizon IHH Healthcare Bhd is expected to under-perform the YTL Hospitality. In addition to that, IHH Healthcare is 1.02 times more volatile than YTL Hospitality REIT. It trades about -0.13 of its total potential returns per unit of risk. YTL Hospitality REIT is currently generating about -0.03 per unit of volatility. If you would invest 101.00 in YTL Hospitality REIT on January 13, 2025 and sell it today you would lose (1.00) from holding YTL Hospitality REIT or give up 0.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IHH Healthcare Bhd vs. YTL Hospitality REIT
Performance |
| Timeline |
| IHH Healthcare Bhd |
| YTL Hospitality REIT |
IHH Healthcare and YTL Hospitality Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IHH Healthcare and YTL Hospitality
The main advantage of trading using opposite IHH Healthcare and YTL Hospitality positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IHH Healthcare position performs unexpectedly, YTL Hospitality 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 YTL Hospitality will offset losses from the drop in YTL Hospitality's long position.| IHH Healthcare vs. Diversified Gateway Solutions | IHH Healthcare vs. YX Precious Metals | IHH Healthcare vs. Sunway Construction Group | IHH Healthcare vs. Berjaya Food Bhd |
| YTL Hospitality vs. Diversified Gateway Solutions | YTL Hospitality vs. Privasia Technology Bhd | YTL Hospitality vs. YX Precious Metals | YTL Hospitality vs. Bank Islam Malaysia |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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