Correlation Between MPH Health and ANTA SPORTS
Can any of the company-specific risk be diversified away by investing in both MPH Health and ANTA SPORTS 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 MPH Health and ANTA SPORTS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MPH Health Care and ANTA SPORTS PRODUCT, you can compare the effects of market volatilities on MPH Health and ANTA SPORTS 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 MPH Health with a short position of ANTA SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of MPH Health and ANTA SPORTS.
Diversification Opportunities for MPH Health and ANTA SPORTS
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between MPH and ANTA is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding MPH Health Care and ANTA SPORTS PRODUCT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA SPORTS PRODUCT and MPH 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 MPH Health Care are associated (or correlated) with ANTA SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA SPORTS PRODUCT has no effect on the direction of MPH Health i.e., MPH Health and ANTA SPORTS go up and down completely randomly.
Pair Corralation between MPH Health and ANTA SPORTS
Assuming the 90 days trading horizon MPH Health Care is expected to generate 1.03 times more return on investment than ANTA SPORTS. However, MPH Health is 1.03 times more volatile than ANTA SPORTS PRODUCT. It trades about -0.06 of its potential returns per unit of risk. ANTA SPORTS PRODUCT is currently generating about -0.09 per unit of risk. If you would invest 2,440 in MPH Health Care on October 12, 2024 and sell it today you would lose (60.00) from holding MPH Health Care or give up 2.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MPH Health Care vs. ANTA SPORTS PRODUCT
Performance |
| Timeline |
| MPH Health Care |
| ANTA SPORTS PRODUCT |
MPH Health and ANTA SPORTS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MPH Health and ANTA SPORTS
The main advantage of trading using opposite MPH Health and ANTA SPORTS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MPH Health position performs unexpectedly, ANTA SPORTS 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 ANTA SPORTS will offset losses from the drop in ANTA SPORTS's long position.The idea behind MPH Health Care and ANTA SPORTS PRODUCT pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| ANTA SPORTS vs. MPH Health Care | ANTA SPORTS vs. SALESFORCE INC CDR | ANTA SPORTS vs. NIGHTINGALE HEALTH EO | ANTA SPORTS vs. FEMALE HEALTH |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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