Correlation Between Central Industrial and DC HEALTHCARE
Can any of the company-specific risk be diversified away by investing in both Central Industrial and DC 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 Central Industrial and DC HEALTHCARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Central Industrial Corp and DC HEALTHCARE HOLDINGS, you can compare the effects of market volatilities on Central Industrial and DC 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 Central Industrial with a short position of DC HEALTHCARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Industrial and DC HEALTHCARE.
Diversification Opportunities for Central Industrial and DC HEALTHCARE
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Central and 0283 is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Central Industrial Corp and DC HEALTHCARE HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DC HEALTHCARE HOLDINGS and Central Industrial 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 Central Industrial Corp are associated (or correlated) with DC HEALTHCARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DC HEALTHCARE HOLDINGS has no effect on the direction of Central Industrial i.e., Central Industrial and DC HEALTHCARE go up and down completely randomly.
Pair Corralation between Central Industrial and DC HEALTHCARE
Assuming the 90 days trading horizon Central Industrial Corp is expected to generate 0.2 times more return on investment than DC HEALTHCARE. However, Central Industrial Corp is 4.88 times less risky than DC HEALTHCARE. It trades about 0.26 of its potential returns per unit of risk. DC HEALTHCARE HOLDINGS is currently generating about 0.02 per unit of risk. If you would invest 83.00 in Central Industrial Corp on August 27, 2024 and sell it today you would earn a total of 3.00 from holding Central Industrial Corp or generate 3.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Industrial Corp vs. DC HEALTHCARE HOLDINGS
Performance |
| Timeline |
| Central Industrial Corp |
| DC HEALTHCARE HOLDINGS |
Central Industrial and DC HEALTHCARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Industrial and DC HEALTHCARE
The main advantage of trading using opposite Central Industrial and DC HEALTHCARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Industrial position performs unexpectedly, DC 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 DC HEALTHCARE will offset losses from the drop in DC HEALTHCARE's long position.| Central Industrial vs. YTL Hospitality REIT | Central Industrial vs. Choo Bee Metal | Central Industrial vs. Oriental Food Industries | Central Industrial vs. Apollo Food Holdings |
| DC HEALTHCARE vs. Malayan Banking Bhd | DC HEALTHCARE vs. Public Bank Bhd | DC HEALTHCARE vs. Petronas Chemicals Group | DC HEALTHCARE vs. Tenaga Nasional Bhd |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |