Correlation Between Caihong Display and Innovative Medical
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By analyzing existing cross correlation between Caihong Display Devices and Innovative Medical Management, you can compare the effects of market volatilities on Caihong Display and Innovative Medical 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 Caihong Display with a short position of Innovative Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caihong Display and Innovative Medical.
Diversification Opportunities for Caihong Display and Innovative Medical
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Caihong and Innovative is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Caihong Display Devices and Innovative Medical Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovative Medical and Caihong Display 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 Caihong Display Devices are associated (or correlated) with Innovative Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovative Medical has no effect on the direction of Caihong Display i.e., Caihong Display and Innovative Medical go up and down completely randomly.
Pair Corralation between Caihong Display and Innovative Medical
Assuming the 90 days trading horizon Caihong Display Devices is expected to generate 0.73 times more return on investment than Innovative Medical. However, Caihong Display Devices is 1.37 times less risky than Innovative Medical. It trades about 0.06 of its potential returns per unit of risk. Innovative Medical Management is currently generating about 0.03 per unit of risk. If you would invest 463.00 in Caihong Display Devices on October 16, 2024 and sell it today you would earn a total of 322.00 from holding Caihong Display Devices or generate 69.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caihong Display Devices vs. Innovative Medical Management
Performance |
| Timeline |
| Caihong Display Devices |
| Innovative Medical |
Caihong Display and Innovative Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caihong Display and Innovative Medical
The main advantage of trading using opposite Caihong Display and Innovative Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caihong Display position performs unexpectedly, Innovative Medical 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 Innovative Medical will offset losses from the drop in Innovative Medical's long position.| Caihong Display vs. Holitech Technology Co | Caihong Display vs. Hubei Forbon Technology | Caihong Display vs. Linewell Software Co | Caihong Display vs. Tianshui Huatian Technology |
| Innovative Medical vs. Southern PublishingMedia Co | Innovative Medical vs. Jiangsu Jinling Sports | Innovative Medical vs. Caihong Display Devices | Innovative Medical vs. Beijing Enlight Media |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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