Correlation Between Asia Metal and SS Healthcare
Can any of the company-specific risk be diversified away by investing in both Asia Metal and SS Healthcare 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 Asia Metal and SS Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Metal Industries and SS Healthcare Holding, you can compare the effects of market volatilities on Asia Metal and SS 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 Asia Metal with a short position of SS Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Metal and SS Healthcare.
Diversification Opportunities for Asia Metal and SS Healthcare
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Asia and 4198 is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Asia Metal Industries and SS Healthcare Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SS Healthcare Holding and Asia Metal 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 Asia Metal Industries are associated (or correlated) with SS Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SS Healthcare Holding has no effect on the direction of Asia Metal i.e., Asia Metal and SS Healthcare go up and down completely randomly.
Pair Corralation between Asia Metal and SS Healthcare
Assuming the 90 days trading horizon Asia Metal Industries is expected to generate 1.23 times more return on investment than SS Healthcare. However, Asia Metal is 1.23 times more volatile than SS Healthcare Holding. It trades about 0.01 of its potential returns per unit of risk. SS Healthcare Holding is currently generating about 0.0 per unit of risk. If you would invest 8,880 in Asia Metal Industries on September 3, 2024 and sell it today you would lose (80.00) from holding Asia Metal Industries or give up 0.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Metal Industries vs. SS Healthcare Holding
Performance |
| Timeline |
| Asia Metal Industries |
| SS Healthcare Holding |
Asia Metal and SS Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Metal and SS Healthcare
The main advantage of trading using opposite Asia Metal and SS Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Metal position performs unexpectedly, SS 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 SS Healthcare will offset losses from the drop in SS Healthcare's long position.| Asia Metal vs. Highlight Tech | Asia Metal vs. WiseChip Semiconductor | Asia Metal vs. Novatek Microelectronics Corp | Asia Metal vs. Leader Electronics |
| SS Healthcare vs. Sunspring Metal Corp | SS Healthcare vs. WinMate Communication INC | SS Healthcare vs. Asia Metal Industries | SS Healthcare vs. RiTdisplay Corp |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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