Correlation Between Sun Max and Pacific Hospital
Can any of the company-specific risk be diversified away by investing in both Sun Max and Pacific Hospital at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sun Max and Pacific Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sun Max Tech and Pacific Hospital Supply, you can compare the effects of market volatilities on Sun Max and Pacific Hospital 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 Sun Max with a short position of Pacific Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sun Max and Pacific Hospital.
Diversification Opportunities for Sun Max and Pacific Hospital
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sun and Pacific is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Sun Max Tech and Pacific Hospital Supply in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pacific Hospital Supply and Sun Max 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 Sun Max Tech are associated (or correlated) with Pacific Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pacific Hospital Supply has no effect on the direction of Sun Max i.e., Sun Max and Pacific Hospital go up and down completely randomly.
Pair Corralation between Sun Max and Pacific Hospital
Assuming the 90 days trading horizon Sun Max is expected to generate 1.18 times less return on investment than Pacific Hospital. In addition to that, Sun Max is 3.08 times more volatile than Pacific Hospital Supply. It trades about 0.02 of its total potential returns per unit of risk. Pacific Hospital Supply is currently generating about 0.07 per unit of volatility. If you would invest 7,854 in Pacific Hospital Supply on August 29, 2024 and sell it today you would earn a total of 1,046 from holding Pacific Hospital Supply or generate 13.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sun Max Tech vs. Pacific Hospital Supply
Performance |
| Timeline |
| Sun Max Tech |
| Pacific Hospital Supply |
Sun Max and Pacific Hospital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sun Max and Pacific Hospital
The main advantage of trading using opposite Sun Max and Pacific Hospital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sun Max position performs unexpectedly, Pacific Hospital 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 Pacific Hospital will offset losses from the drop in Pacific Hospital's long position.| Sun Max vs. ASRock Inc | Sun Max vs. Ko Ja Cayman | Sun Max vs. Chenbro Micom Co | Sun Max vs. Leadtek Research |
| Pacific Hospital vs. Universal Vision Biotechnology | Pacific Hospital vs. Excelsior Medical Co | Pacific Hospital vs. Delta Asia International | Pacific Hospital vs. Hi Clearance |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |