Correlation Between IHH Healthcare and Apollo Food
Can any of the company-specific risk be diversified away by investing in both IHH Healthcare and Apollo Food 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 Apollo Food 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 Apollo Food Holdings, you can compare the effects of market volatilities on IHH Healthcare and Apollo Food 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 Apollo Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of IHH Healthcare and Apollo Food.
Diversification Opportunities for IHH Healthcare and Apollo Food
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between IHH and Apollo is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding IHH Healthcare Bhd and Apollo Food Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Food Holdings 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 Apollo Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Food Holdings has no effect on the direction of IHH Healthcare i.e., IHH Healthcare and Apollo Food go up and down completely randomly.
Pair Corralation between IHH Healthcare and Apollo Food
Assuming the 90 days trading horizon IHH Healthcare Bhd is expected to generate 2.01 times more return on investment than Apollo Food. However, IHH Healthcare is 2.01 times more volatile than Apollo Food Holdings. It trades about -0.01 of its potential returns per unit of risk. Apollo Food Holdings is currently generating about -0.26 per unit of risk. If you would invest 728.00 in IHH Healthcare Bhd on September 2, 2024 and sell it today you would lose (2.00) from holding IHH Healthcare Bhd or give up 0.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IHH Healthcare Bhd vs. Apollo Food Holdings
Performance |
| Timeline |
| IHH Healthcare Bhd |
| Apollo Food Holdings |
IHH Healthcare and Apollo Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IHH Healthcare and Apollo Food
The main advantage of trading using opposite IHH Healthcare and Apollo Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IHH Healthcare position performs unexpectedly, Apollo Food 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 Apollo Food will offset losses from the drop in Apollo Food's long position.| IHH Healthcare vs. Cloudpoint Technology Berhad | IHH Healthcare vs. Duopharma Biotech Bhd | IHH Healthcare vs. Dataprep Holdings Bhd | IHH Healthcare vs. Uchi Technologies Bhd |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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