Correlation Between Central Industrial and Apex Healthcare
Can any of the company-specific risk be diversified away by investing in both Central Industrial and Apex 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 Apex 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 Apex Healthcare Bhd, you can compare the effects of market volatilities on Central Industrial and Apex 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 Apex Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Industrial and Apex Healthcare.
Diversification Opportunities for Central Industrial and Apex Healthcare
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Central and Apex is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Central Industrial Corp and Apex Healthcare Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apex Healthcare Bhd 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 Apex Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apex Healthcare Bhd has no effect on the direction of Central Industrial i.e., Central Industrial and Apex Healthcare go up and down completely randomly.
Pair Corralation between Central Industrial and Apex Healthcare
Assuming the 90 days trading horizon Central Industrial Corp is expected to generate 1.09 times more return on investment than Apex Healthcare. However, Central Industrial is 1.09 times more volatile than Apex Healthcare Bhd. It trades about -0.01 of its potential returns per unit of risk. Apex Healthcare Bhd is currently generating about -0.08 per unit of risk. If you would invest 89.00 in Central Industrial Corp on November 2, 2024 and sell it today you would lose (1.00) from holding Central Industrial Corp or give up 1.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Industrial Corp vs. Apex Healthcare Bhd
Performance |
| Timeline |
| Central Industrial Corp |
| Apex Healthcare Bhd |
Central Industrial and Apex Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Industrial and Apex Healthcare
The main advantage of trading using opposite Central Industrial and Apex Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Industrial position performs unexpectedly, Apex 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 Apex Healthcare will offset losses from the drop in Apex Healthcare's long position.| Central Industrial vs. SFP Tech Holdings | Central Industrial vs. Media Prima Bhd | Central Industrial vs. Senheng New Retail | Central Industrial vs. EA Technique M |
| Apex Healthcare vs. Bank Islam Malaysia | Apex Healthcare vs. Aeon Credit Service | Apex Healthcare vs. Greatech Technology Bhd | Apex Healthcare vs. Computer Forms 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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