Correlation Between Bannix Acquisition and China Health
Can any of the company-specific risk be diversified away by investing in both Bannix Acquisition and China 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 Bannix Acquisition and China Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bannix Acquisition Corp and China Health Management, you can compare the effects of market volatilities on Bannix Acquisition and China 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 Bannix Acquisition with a short position of China Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bannix Acquisition and China Health.
Diversification Opportunities for Bannix Acquisition and China Health
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bannix and China is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Bannix Acquisition Corp and China Health Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Health Management and Bannix Acquisition 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 Bannix Acquisition Corp are associated (or correlated) with China Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Health Management has no effect on the direction of Bannix Acquisition i.e., Bannix Acquisition and China Health go up and down completely randomly.
Pair Corralation between Bannix Acquisition and China Health
Given the investment horizon of 90 days Bannix Acquisition is expected to generate 58.29 times less return on investment than China Health. But when comparing it to its historical volatility, Bannix Acquisition Corp is 54.27 times less risky than China Health. It trades about 0.06 of its potential returns per unit of risk. China Health Management is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.50 in China Health Management on August 26, 2024 and sell it today you would earn a total of 0.11 from holding China Health Management or generate 22.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bannix Acquisition Corp vs. China Health Management
Performance |
| Timeline |
| Bannix Acquisition Corp |
| China Health Management |
Bannix Acquisition and China Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bannix Acquisition and China Health
The main advantage of trading using opposite Bannix Acquisition and China Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bannix Acquisition position performs unexpectedly, China 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 China Health will offset losses from the drop in China Health's long position.| Bannix Acquisition vs. Embrace Change Acquisition | Bannix Acquisition vs. Global Blockchain Acquisition | Bannix Acquisition vs. TransAKT | Bannix Acquisition vs. China Health Management |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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