Correlation Between Choo Bee and IHH Healthcare
Can any of the company-specific risk be diversified away by investing in both Choo Bee and IHH 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 Choo Bee and IHH Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Choo Bee Metal and IHH Healthcare Bhd, you can compare the effects of market volatilities on Choo Bee and IHH 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 Choo Bee with a short position of IHH Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Choo Bee and IHH Healthcare.
Diversification Opportunities for Choo Bee and IHH Healthcare
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Choo and IHH is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Choo Bee Metal and IHH Healthcare Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IHH Healthcare Bhd and Choo Bee 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 Choo Bee Metal are associated (or correlated) with IHH Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IHH Healthcare Bhd has no effect on the direction of Choo Bee i.e., Choo Bee and IHH Healthcare go up and down completely randomly.
Pair Corralation between Choo Bee and IHH Healthcare
Assuming the 90 days trading horizon Choo Bee Metal is expected to under-perform the IHH Healthcare. In addition to that, Choo Bee is 1.94 times more volatile than IHH Healthcare Bhd. It trades about -0.06 of its total potential returns per unit of risk. IHH Healthcare Bhd is currently generating about 0.12 per unit of volatility. If you would invest 634.00 in IHH Healthcare Bhd on November 2, 2024 and sell it today you would earn a total of 81.00 from holding IHH Healthcare Bhd or generate 12.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Choo Bee Metal vs. IHH Healthcare Bhd
Performance |
| Timeline |
| Choo Bee Metal |
| IHH Healthcare Bhd |
Choo Bee and IHH Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Choo Bee and IHH Healthcare
The main advantage of trading using opposite Choo Bee and IHH Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Choo Bee position performs unexpectedly, IHH 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 IHH Healthcare will offset losses from the drop in IHH Healthcare's long position.| Choo Bee vs. Binasat Communications Bhd | Choo Bee vs. Cosmos Technology International | Choo Bee vs. YX Precious Metals | Choo Bee vs. PMB Technology Bhd |
| IHH Healthcare vs. Cloudpoint Technology Berhad | IHH Healthcare vs. TAS Offshore Bhd | IHH Healthcare vs. Icon Offshore Bhd | IHH Healthcare vs. Sports Toto Berhad |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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