Correlation Between Eastern Communications and Allmed Medical
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By analyzing existing cross correlation between Eastern Communications Co and Allmed Medical Products, you can compare the effects of market volatilities on Eastern Communications and Allmed Medical 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 Eastern Communications with a short position of Allmed Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastern Communications and Allmed Medical.
Diversification Opportunities for Eastern Communications and Allmed Medical
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eastern and Allmed is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Eastern Communications Co and Allmed Medical Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allmed Medical Products and Eastern Communications 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 Eastern Communications Co are associated (or correlated) with Allmed Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allmed Medical Products has no effect on the direction of Eastern Communications i.e., Eastern Communications and Allmed Medical go up and down completely randomly.
Pair Corralation between Eastern Communications and Allmed Medical
Assuming the 90 days trading horizon Eastern Communications is expected to generate 3.32 times less return on investment than Allmed Medical. But when comparing it to its historical volatility, Eastern Communications Co is 1.18 times less risky than Allmed Medical. It trades about 0.05 of its potential returns per unit of risk. Allmed Medical Products is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 872.00 in Allmed Medical Products on August 28, 2024 and sell it today you would earn a total of 85.00 from holding Allmed Medical Products or generate 9.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastern Communications Co vs. Allmed Medical Products
Performance |
| Timeline |
| Eastern Communications |
| Allmed Medical Products |
Eastern Communications and Allmed Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastern Communications and Allmed Medical
The main advantage of trading using opposite Eastern Communications and Allmed Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastern Communications position performs unexpectedly, Allmed Medical 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 Allmed Medical will offset losses from the drop in Allmed Medical's long position.| Eastern Communications vs. Guangdong Jinma Entertainment | Eastern Communications vs. Huaibei Mining Holdings | Eastern Communications vs. Zijin Mining Group | Eastern Communications vs. Xinjiang Baodi Mining |
| Allmed Medical vs. Bank of China | Allmed Medical vs. Kweichow Moutai Co | Allmed Medical vs. PetroChina Co Ltd | Allmed Medical vs. Bank of Communications |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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