Correlation Between Healthcare and AVIC Fund
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By analyzing existing cross correlation between Healthcare Co and AVIC Fund Management, you can compare the effects of market volatilities on Healthcare and AVIC Fund 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 Healthcare with a short position of AVIC Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare and AVIC Fund.
Diversification Opportunities for Healthcare and AVIC Fund
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Healthcare and AVIC is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Co and AVIC Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVIC Fund Management and 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 Healthcare Co are associated (or correlated) with AVIC Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVIC Fund Management has no effect on the direction of Healthcare i.e., Healthcare and AVIC Fund go up and down completely randomly.
Pair Corralation between Healthcare and AVIC Fund
Assuming the 90 days trading horizon Healthcare is expected to generate 4.04 times less return on investment than AVIC Fund. In addition to that, Healthcare is 5.72 times more volatile than AVIC Fund Management. It trades about 0.02 of its total potential returns per unit of risk. AVIC Fund Management is currently generating about 0.52 per unit of volatility. If you would invest 1,003 in AVIC Fund Management on September 29, 2024 and sell it today you would earn a total of 56.00 from holding AVIC Fund Management or generate 5.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Healthcare Co vs. AVIC Fund Management
Performance |
| Timeline |
| Healthcare |
| AVIC Fund Management |
Healthcare and AVIC Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthcare and AVIC Fund
The main advantage of trading using opposite Healthcare and AVIC Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare position performs unexpectedly, AVIC Fund 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 AVIC Fund will offset losses from the drop in AVIC Fund's long position.| Healthcare vs. Agricultural Bank of | Healthcare vs. Industrial and Commercial | Healthcare vs. Bank of China | Healthcare vs. China Construction Bank |
| AVIC Fund vs. Industrial and Commercial | AVIC Fund vs. Kweichow Moutai Co | AVIC Fund vs. Agricultural Bank of | AVIC Fund vs. China Mobile Limited |
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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