Correlation Between Grupo Aval and JD HEALTH
Can any of the company-specific risk be diversified away by investing in both Grupo Aval and JD HEALTH 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 Grupo Aval and JD HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grupo Aval Acciones and JD HEALTH INTL, you can compare the effects of market volatilities on Grupo Aval and JD HEALTH 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 Grupo Aval with a short position of JD HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grupo Aval and JD HEALTH.
Diversification Opportunities for Grupo Aval and JD HEALTH
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Grupo and 8ZN is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Grupo Aval Acciones and JD HEALTH INTL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD HEALTH INTL and Grupo Aval 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 Grupo Aval Acciones are associated (or correlated) with JD HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD HEALTH INTL has no effect on the direction of Grupo Aval i.e., Grupo Aval and JD HEALTH go up and down completely randomly.
Pair Corralation between Grupo Aval and JD HEALTH
Assuming the 90 days trading horizon Grupo Aval Acciones is expected to generate 1.11 times more return on investment than JD HEALTH. However, Grupo Aval is 1.11 times more volatile than JD HEALTH INTL. It trades about 0.52 of its potential returns per unit of risk. JD HEALTH INTL is currently generating about 0.19 per unit of risk. If you would invest 199.00 in Grupo Aval Acciones on November 6, 2024 and sell it today you would earn a total of 63.00 from holding Grupo Aval Acciones or generate 31.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grupo Aval Acciones vs. JD HEALTH INTL
Performance |
| Timeline |
| Grupo Aval Acciones |
| JD HEALTH INTL |
Grupo Aval and JD HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grupo Aval and JD HEALTH
The main advantage of trading using opposite Grupo Aval and JD HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grupo Aval position performs unexpectedly, JD HEALTH 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 JD HEALTH will offset losses from the drop in JD HEALTH's long position.| Grupo Aval vs. NXP Semiconductors NV | Grupo Aval vs. TOREX SEMICONDUCTOR LTD | Grupo Aval vs. MAANSHAN IRON H | Grupo Aval vs. Hua Hong Semiconductor |
| JD HEALTH vs. Fresenius SE Co | JD HEALTH vs. Option Care Health | JD HEALTH vs. HYGEIA HC HLDGS | JD HEALTH vs. MODIVCARE INC DL 001 |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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