Correlation Between JD HEALTH and VITA 34
Can any of the company-specific risk be diversified away by investing in both JD HEALTH and VITA 34 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 JD HEALTH and VITA 34 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD HEALTH INTL and VITA 34 AG, you can compare the effects of market volatilities on JD HEALTH and VITA 34 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 JD HEALTH with a short position of VITA 34. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD HEALTH and VITA 34.
Diversification Opportunities for JD HEALTH and VITA 34
Very good diversification
The 3 months correlation between 8ZN and VITA is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding JD HEALTH INTL and VITA 34 AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VITA 34 AG and JD HEALTH 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 JD HEALTH INTL are associated (or correlated) with VITA 34. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VITA 34 AG has no effect on the direction of JD HEALTH i.e., JD HEALTH and VITA 34 go up and down completely randomly.
Pair Corralation between JD HEALTH and VITA 34
Assuming the 90 days horizon JD HEALTH INTL is expected to generate 2.43 times more return on investment than VITA 34. However, JD HEALTH is 2.43 times more volatile than VITA 34 AG. It trades about 0.11 of its potential returns per unit of risk. VITA 34 AG is currently generating about -0.11 per unit of risk. If you would invest 266.00 in JD HEALTH INTL on September 2, 2024 and sell it today you would earn a total of 74.00 from holding JD HEALTH INTL or generate 27.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD HEALTH INTL vs. VITA 34 AG
Performance |
| Timeline |
| JD HEALTH INTL |
| VITA 34 AG |
JD HEALTH and VITA 34 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD HEALTH and VITA 34
The main advantage of trading using opposite JD HEALTH and VITA 34 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD HEALTH position performs unexpectedly, VITA 34 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 VITA 34 will offset losses from the drop in VITA 34's long position.| JD HEALTH vs. Fresenius SE Co | JD HEALTH vs. Fresenius Medical Care | JD HEALTH vs. Sonic Healthcare Limited | JD HEALTH vs. Option Care Health |
| VITA 34 vs. International Consolidated Airlines | VITA 34 vs. AEGEAN AIRLINES | VITA 34 vs. Aegean Airlines SA | VITA 34 vs. MagnaChip Semiconductor 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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