Correlation Between Humanwell Healthcare and Changchun High
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By analyzing existing cross correlation between Humanwell Healthcare Group and Changchun High New, you can compare the effects of market volatilities on Humanwell Healthcare and Changchun High 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 Humanwell Healthcare with a short position of Changchun High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humanwell Healthcare and Changchun High.
Diversification Opportunities for Humanwell Healthcare and Changchun High
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Humanwell and Changchun is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Humanwell Healthcare Group and Changchun High New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun High New and Humanwell 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 Humanwell Healthcare Group are associated (or correlated) with Changchun High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun High New has no effect on the direction of Humanwell Healthcare i.e., Humanwell Healthcare and Changchun High go up and down completely randomly.
Pair Corralation between Humanwell Healthcare and Changchun High
Assuming the 90 days trading horizon Humanwell Healthcare Group is expected to generate 2.09 times more return on investment than Changchun High. However, Humanwell Healthcare is 2.09 times more volatile than Changchun High New. It trades about -0.07 of its potential returns per unit of risk. Changchun High New is currently generating about -0.23 per unit of risk. If you would invest 2,353 in Humanwell Healthcare Group on October 24, 2024 and sell it today you would lose (109.00) from holding Humanwell Healthcare Group or give up 4.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Humanwell Healthcare Group vs. Changchun High New
Performance |
| Timeline |
| Humanwell Healthcare |
| Changchun High New |
Humanwell Healthcare and Changchun High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humanwell Healthcare and Changchun High
The main advantage of trading using opposite Humanwell Healthcare and Changchun High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humanwell Healthcare position performs unexpectedly, Changchun High 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 Changchun High will offset losses from the drop in Changchun High's long position.The idea behind Humanwell Healthcare Group and Changchun High New pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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