Correlation Between Ao World and MyHealthChecked Plc
Can any of the company-specific risk be diversified away by investing in both Ao World and MyHealthChecked Plc 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 Ao World and MyHealthChecked Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ao World and MyHealthChecked Plc, you can compare the effects of market volatilities on Ao World and MyHealthChecked Plc 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 Ao World with a short position of MyHealthChecked Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ao World and MyHealthChecked Plc.
Diversification Opportunities for Ao World and MyHealthChecked Plc
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ao World and MyHealthChecked is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Ao World and MyHealthChecked Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MyHealthChecked Plc and Ao World 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 Ao World are associated (or correlated) with MyHealthChecked Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MyHealthChecked Plc has no effect on the direction of Ao World i.e., Ao World and MyHealthChecked Plc go up and down completely randomly.
Pair Corralation between Ao World and MyHealthChecked Plc
Assuming the 90 days trading horizon Ao World is expected to under-perform the MyHealthChecked Plc. But the stock apears to be less risky and, when comparing its historical volatility, Ao World is 2.69 times less risky than MyHealthChecked Plc. The stock trades about -0.13 of its potential returns per unit of risk. The MyHealthChecked Plc is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,325 in MyHealthChecked Plc on October 25, 2024 and sell it today you would earn a total of 525.00 from holding MyHealthChecked Plc or generate 39.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ao World vs. MyHealthChecked Plc
Performance |
| Timeline |
| Ao World |
| MyHealthChecked Plc |
Ao World and MyHealthChecked Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ao World and MyHealthChecked Plc
The main advantage of trading using opposite Ao World and MyHealthChecked Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ao World position performs unexpectedly, MyHealthChecked Plc 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 MyHealthChecked Plc will offset losses from the drop in MyHealthChecked Plc's long position.| Ao World vs. MyHealthChecked Plc | Ao World vs. Premier Foods PLC | Ao World vs. Optima Health plc | Ao World vs. Inspiration Healthcare Group |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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