Correlation Between Industrial and Healthcare
Specify exactly 2 symbols:
By analyzing existing cross correlation between Industrial and Commercial and Healthcare Co, you can compare the effects of market volatilities on Industrial 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 Industrial with a short position of Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Healthcare.
Diversification Opportunities for Industrial and Healthcare
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Industrial and Healthcare is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Healthcare Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthcare and Industrial 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 Industrial and Commercial 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 Industrial i.e., Industrial and Healthcare go up and down completely randomly.
Pair Corralation between Industrial and Healthcare
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.52 times more return on investment than Healthcare. However, Industrial and Commercial is 1.92 times less risky than Healthcare. It trades about 0.08 of its potential returns per unit of risk. Healthcare Co is currently generating about -0.03 per unit of risk. If you would invest 403.00 in Industrial and Commercial on September 3, 2024 and sell it today you would earn a total of 212.00 from holding Industrial and Commercial or generate 52.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Healthcare Co
Performance |
| Timeline |
| Industrial and Commercial |
| Healthcare |
Industrial and Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Healthcare
The main advantage of trading using opposite Industrial and Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial 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.| Industrial vs. Tengda Construction Group | Industrial vs. Hongrun Construction Group | Industrial vs. HUAQIN TECHNOLOGY LTD | Industrial vs. Sinomach General Machinery |
| Healthcare vs. PetroChina Co Ltd | Healthcare vs. China Mobile Limited | Healthcare vs. Industrial and Commercial | Healthcare vs. China Life Insurance |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |