Correlation Between Asia Fiber and Aikchol Hospital
Can any of the company-specific risk be diversified away by investing in both Asia Fiber and Aikchol Hospital 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 Asia Fiber and Aikchol Hospital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Fiber Public and Aikchol Hospital Public, you can compare the effects of market volatilities on Asia Fiber and Aikchol Hospital 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 Asia Fiber with a short position of Aikchol Hospital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Fiber and Aikchol Hospital.
Diversification Opportunities for Asia Fiber and Aikchol Hospital
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asia and Aikchol is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Asia Fiber Public and Aikchol Hospital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aikchol Hospital Public and Asia Fiber 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 Asia Fiber Public are associated (or correlated) with Aikchol Hospital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aikchol Hospital Public has no effect on the direction of Asia Fiber i.e., Asia Fiber and Aikchol Hospital go up and down completely randomly.
Pair Corralation between Asia Fiber and Aikchol Hospital
Assuming the 90 days trading horizon Asia Fiber Public is expected to under-perform the Aikchol Hospital. In addition to that, Asia Fiber is 1.85 times more volatile than Aikchol Hospital Public. It trades about -0.04 of its total potential returns per unit of risk. Aikchol Hospital Public is currently generating about -0.05 per unit of volatility. If you would invest 1,520 in Aikchol Hospital Public on November 27, 2024 and sell it today you would lose (20.00) from holding Aikchol Hospital Public or give up 1.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Fiber Public vs. Aikchol Hospital Public
Performance |
| Timeline |
| Asia Fiber Public |
| Aikchol Hospital Public |
Asia Fiber and Aikchol Hospital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Fiber and Aikchol Hospital
The main advantage of trading using opposite Asia Fiber and Aikchol Hospital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Fiber position performs unexpectedly, Aikchol Hospital 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 Aikchol Hospital will offset losses from the drop in Aikchol Hospital's long position.| Asia Fiber vs. AJ Plast Public | Asia Fiber vs. Aikchol Hospital Public | Asia Fiber vs. Boutique Newcity Public | Asia Fiber vs. Allianz Ayudhya Capital |
| Aikchol Hospital vs. AP Public | Aikchol Hospital vs. Bumrungrad Hospital PCL | Aikchol Hospital vs. Advanced Information Technology | Aikchol Hospital vs. AJ Plast Public |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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