Correlation Between Healthcare and Shanghai Bailian
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By analyzing existing cross correlation between Healthcare Co and Shanghai Bailian Group, you can compare the effects of market volatilities on Healthcare and Shanghai Bailian 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 Shanghai Bailian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare and Shanghai Bailian.
Diversification Opportunities for Healthcare and Shanghai Bailian
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Healthcare and Shanghai is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Co and Shanghai Bailian Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Bailian 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 Shanghai Bailian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Bailian has no effect on the direction of Healthcare i.e., Healthcare and Shanghai Bailian go up and down completely randomly.
Pair Corralation between Healthcare and Shanghai Bailian
Assuming the 90 days trading horizon Healthcare Co is expected to generate 0.99 times more return on investment than Shanghai Bailian. However, Healthcare Co is 1.01 times less risky than Shanghai Bailian. It trades about 0.29 of its potential returns per unit of risk. Shanghai Bailian Group is currently generating about 0.27 per unit of risk. If you would invest 617.00 in Healthcare Co on September 2, 2024 and sell it today you would earn a total of 122.00 from holding Healthcare Co or generate 19.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Healthcare Co vs. Shanghai Bailian Group
Performance |
| Timeline |
| Healthcare |
| Shanghai Bailian |
Healthcare and Shanghai Bailian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthcare and Shanghai Bailian
The main advantage of trading using opposite Healthcare and Shanghai Bailian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare position performs unexpectedly, Shanghai Bailian 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 Shanghai Bailian will offset losses from the drop in Shanghai Bailian's long position.| Healthcare vs. Kweichow Moutai Co | Healthcare vs. NAURA Technology Group | Healthcare vs. Zhejiang Orient Gene | Healthcare vs. APT Medical |
| Shanghai Bailian vs. Eastern Air Logistics | Shanghai Bailian vs. Guangzhou Haige Communications | Shanghai Bailian vs. Allwin Telecommunication Co | Shanghai Bailian vs. MayAir Technology Co |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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