Correlation Between Aikchol Hospital and Diamond Building
Can any of the company-specific risk be diversified away by investing in both Aikchol Hospital and Diamond Building 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 Aikchol Hospital and Diamond Building into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aikchol Hospital Public and Diamond Building Products, you can compare the effects of market volatilities on Aikchol Hospital and Diamond Building 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 Aikchol Hospital with a short position of Diamond Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aikchol Hospital and Diamond Building.
Diversification Opportunities for Aikchol Hospital and Diamond Building
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aikchol and Diamond is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Aikchol Hospital Public and Diamond Building Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamond Building Products and Aikchol Hospital 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 Aikchol Hospital Public are associated (or correlated) with Diamond Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamond Building Products has no effect on the direction of Aikchol Hospital i.e., Aikchol Hospital and Diamond Building go up and down completely randomly.
Pair Corralation between Aikchol Hospital and Diamond Building
Assuming the 90 days trading horizon Aikchol Hospital Public is expected to generate 106.75 times more return on investment than Diamond Building. However, Aikchol Hospital is 106.75 times more volatile than Diamond Building Products. It trades about 0.06 of its potential returns per unit of risk. Diamond Building Products is currently generating about 0.02 per unit of risk. If you would invest 1,736 in Aikchol Hospital Public on September 2, 2024 and sell it today you would lose (186.00) from holding Aikchol Hospital Public or give up 10.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aikchol Hospital Public vs. Diamond Building Products
Performance |
| Timeline |
| Aikchol Hospital Public |
| Diamond Building Products |
Aikchol Hospital and Diamond Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aikchol Hospital and Diamond Building
The main advantage of trading using opposite Aikchol Hospital and Diamond Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aikchol Hospital position performs unexpectedly, Diamond Building 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 Diamond Building will offset losses from the drop in Diamond Building's long position.| Aikchol Hospital vs. AP Public | Aikchol Hospital vs. Advanced Information Technology | Aikchol Hospital vs. AJ Plast Public | Aikchol Hospital vs. Berli Jucker Public |
| Diamond Building vs. Haad Thip Public | Diamond Building vs. Lalin Property Public | Diamond Building vs. Dynasty Ceramic Public | Diamond Building vs. AP 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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