Correlation Between Asia Medical and Symphony Communication
Can any of the company-specific risk be diversified away by investing in both Asia Medical and Symphony Communication 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 Medical and Symphony Communication into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Medical Agricultural and Symphony Communication Public, you can compare the effects of market volatilities on Asia Medical and Symphony Communication 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 Medical with a short position of Symphony Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Medical and Symphony Communication.
Diversification Opportunities for Asia Medical and Symphony Communication
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Asia and Symphony is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Asia Medical Agricultural and Symphony Communication Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Symphony Communication and Asia Medical 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 Medical Agricultural are associated (or correlated) with Symphony Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Symphony Communication has no effect on the direction of Asia Medical i.e., Asia Medical and Symphony Communication go up and down completely randomly.
Pair Corralation between Asia Medical and Symphony Communication
Assuming the 90 days trading horizon Asia Medical Agricultural is expected to generate 0.66 times more return on investment than Symphony Communication. However, Asia Medical Agricultural is 1.53 times less risky than Symphony Communication. It trades about -0.15 of its potential returns per unit of risk. Symphony Communication Public is currently generating about -0.32 per unit of risk. If you would invest 123.00 in Asia Medical Agricultural on December 1, 2024 and sell it today you would lose (9.00) from holding Asia Medical Agricultural or give up 7.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Medical Agricultural vs. Symphony Communication Public
Performance |
| Timeline |
| Asia Medical Agricultural |
| Symphony Communication |
Asia Medical and Symphony Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Medical and Symphony Communication
The main advantage of trading using opposite Asia Medical and Symphony Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Medical position performs unexpectedly, Symphony Communication 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 Symphony Communication will offset losses from the drop in Symphony Communication's long position.| Asia Medical vs. Asian Alliance International | ||
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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