Correlation Between Asmedia Technology and MedFirst Healthcare
Can any of the company-specific risk be diversified away by investing in both Asmedia Technology and MedFirst Healthcare 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 Asmedia Technology and MedFirst Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asmedia Technology and MedFirst Healthcare Services, you can compare the effects of market volatilities on Asmedia Technology and MedFirst Healthcare 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 Asmedia Technology with a short position of MedFirst Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asmedia Technology and MedFirst Healthcare.
Diversification Opportunities for Asmedia Technology and MedFirst Healthcare
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Asmedia and MedFirst is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Asmedia Technology and MedFirst Healthcare Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MedFirst Healthcare and Asmedia Technology 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 Asmedia Technology are associated (or correlated) with MedFirst Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MedFirst Healthcare has no effect on the direction of Asmedia Technology i.e., Asmedia Technology and MedFirst Healthcare go up and down completely randomly.
Pair Corralation between Asmedia Technology and MedFirst Healthcare
Assuming the 90 days trading horizon Asmedia Technology is expected to generate 1.89 times more return on investment than MedFirst Healthcare. However, Asmedia Technology is 1.89 times more volatile than MedFirst Healthcare Services. It trades about 0.06 of its potential returns per unit of risk. MedFirst Healthcare Services is currently generating about -0.01 per unit of risk. If you would invest 115,109 in Asmedia Technology on November 27, 2024 and sell it today you would earn a total of 96,891 from holding Asmedia Technology or generate 84.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Asmedia Technology vs. MedFirst Healthcare Services
Performance |
| Timeline |
| Asmedia Technology |
| MedFirst Healthcare |
Asmedia Technology and MedFirst Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asmedia Technology and MedFirst Healthcare
The main advantage of trading using opposite Asmedia Technology and MedFirst Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asmedia Technology position performs unexpectedly, MedFirst Healthcare 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 MedFirst Healthcare will offset losses from the drop in MedFirst Healthcare's long position.| Asmedia Technology vs. Alchip Technologies | Asmedia Technology vs. Aspeed Technology | Asmedia Technology vs. Silergy Corp | Asmedia Technology vs. Global Unichip Corp |
| MedFirst Healthcare vs. WinMate Communication INC | MedFirst Healthcare vs. Eagle Cold Storage | MedFirst Healthcare vs. Far EasTone Telecommunications | MedFirst Healthcare vs. Mercuries Data Systems |
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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