Correlation Between Alibaba Health and Indo Global
Can any of the company-specific risk be diversified away by investing in both Alibaba Health and Indo Global 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 Alibaba Health and Indo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alibaba Health Information and Indo Global Exchange, you can compare the effects of market volatilities on Alibaba Health and Indo Global 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 Alibaba Health with a short position of Indo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alibaba Health and Indo Global.
Diversification Opportunities for Alibaba Health and Indo Global
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alibaba and Indo is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Alibaba Health Information and Indo Global Exchange in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indo Global Exchange and Alibaba 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 Alibaba Health Information are associated (or correlated) with Indo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indo Global Exchange has no effect on the direction of Alibaba Health i.e., Alibaba Health and Indo Global go up and down completely randomly.
Pair Corralation between Alibaba Health and Indo Global
Assuming the 90 days horizon Alibaba Health Information is expected to under-perform the Indo Global. But the pink sheet apears to be less risky and, when comparing its historical volatility, Alibaba Health Information is 2.08 times less risky than Indo Global. The pink sheet trades about -0.09 of its potential returns per unit of risk. The Indo Global Exchange is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 0.05 in Indo Global Exchange on August 29, 2024 and sell it today you would earn a total of 0.01 from holding Indo Global Exchange or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alibaba Health Information vs. Indo Global Exchange
Performance |
| Timeline |
| Alibaba Health Infor |
| Indo Global Exchange |
Alibaba Health and Indo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alibaba Health and Indo Global
The main advantage of trading using opposite Alibaba Health and Indo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alibaba Health position performs unexpectedly, Indo Global 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 Indo Global will offset losses from the drop in Indo Global's long position.| Alibaba Health vs. Indo Global Exchange | Alibaba Health vs. TPT Global Tech | Alibaba Health vs. Valiant Eagle | Alibaba Health vs. Sixty Six Oilfield |
| Indo Global vs. Cann American Corp | Indo Global vs. GelStat Corp | Indo Global vs. Green Cures Botanical | Indo Global vs. For The Earth |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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