Correlation Between Active Health and Absolute Health
Can any of the company-specific risk be diversified away by investing in both Active Health and Absolute Health 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 Active Health and Absolute Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Active Health Foods and Absolute Health and, you can compare the effects of market volatilities on Active Health and Absolute Health 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 Active Health with a short position of Absolute Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Active Health and Absolute Health.
Diversification Opportunities for Active Health and Absolute Health
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Active and Absolute is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Active Health Foods and Absolute Health and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Absolute Health and Active 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 Active Health Foods are associated (or correlated) with Absolute Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Absolute Health has no effect on the direction of Active Health i.e., Active Health and Absolute Health go up and down completely randomly.
Pair Corralation between Active Health and Absolute Health
If you would invest 0.01 in Active Health Foods on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Active Health Foods or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Active Health Foods vs. Absolute Health and
Performance |
| Timeline |
| Active Health Foods |
| Absolute Health |
Active Health and Absolute Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Active Health and Absolute Health
The main advantage of trading using opposite Active Health and Absolute Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Active Health position performs unexpectedly, Absolute Health 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 Absolute Health will offset losses from the drop in Absolute Health's long position.| Active Health vs. Embotelladora Andina SA | Active Health vs. Signet International Holdings | Active Health vs. National Beverage Corp | Active Health vs. PT Astra International |
| Absolute Health vs. Gemz Corp | Absolute Health vs. AVVAA World Health | Absolute Health vs. Newron Sport | Absolute Health vs. Tanke Biosciences |
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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