Correlation Between Chongqing Brewery and Healthcare
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By analyzing existing cross correlation between Chongqing Brewery Co and Healthcare Co, you can compare the effects of market volatilities on Chongqing Brewery and 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 Chongqing Brewery with a short position of Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Brewery and Healthcare.
Diversification Opportunities for Chongqing Brewery and Healthcare
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Healthcare is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Brewery Co and Healthcare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthcare and Chongqing Brewery 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 Chongqing Brewery Co are associated (or correlated) with Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthcare has no effect on the direction of Chongqing Brewery i.e., Chongqing Brewery and Healthcare go up and down completely randomly.
Pair Corralation between Chongqing Brewery and Healthcare
Assuming the 90 days trading horizon Chongqing Brewery Co is expected to under-perform the Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, Chongqing Brewery Co is 1.46 times less risky than Healthcare. The stock trades about -0.07 of its potential returns per unit of risk. The Healthcare Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 660.00 in Healthcare Co on October 14, 2024 and sell it today you would lose (28.00) from holding Healthcare Co or give up 4.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Brewery Co vs. Healthcare Co
Performance |
| Timeline |
| Chongqing Brewery |
| Healthcare |
Chongqing Brewery and Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Brewery and Healthcare
The main advantage of trading using opposite Chongqing Brewery and Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Brewery position performs unexpectedly, 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 Healthcare will offset losses from the drop in Healthcare's long position.| Chongqing Brewery vs. Dhc Software Co | Chongqing Brewery vs. Omnijoi Media Corp | Chongqing Brewery vs. Beijing Enlight Media | Chongqing Brewery vs. Jiangsu Hoperun Software |
| Healthcare vs. Chongqing Brewery Co | Healthcare vs. Jinhui Liquor Co | Healthcare vs. Holitech Technology Co | Healthcare vs. Eyebright Medical Technology |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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