Correlation Between Bumrungrad Hospital and Electronic Arts
Can any of the company-specific risk be diversified away by investing in both Bumrungrad Hospital and Electronic Arts 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 Bumrungrad Hospital and Electronic Arts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bumrungrad Hospital Public and Electronic Arts, you can compare the effects of market volatilities on Bumrungrad Hospital and Electronic Arts 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 Bumrungrad Hospital with a short position of Electronic Arts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bumrungrad Hospital and Electronic Arts.
Diversification Opportunities for Bumrungrad Hospital and Electronic Arts
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bumrungrad and Electronic is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Bumrungrad Hospital Public and Electronic Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronic Arts and Bumrungrad Hospital 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 Bumrungrad Hospital Public are associated (or correlated) with Electronic Arts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronic Arts has no effect on the direction of Bumrungrad Hospital i.e., Bumrungrad Hospital and Electronic Arts go up and down completely randomly.
Pair Corralation between Bumrungrad Hospital and Electronic Arts
Assuming the 90 days trading horizon Bumrungrad Hospital Public is expected to under-perform the Electronic Arts. In addition to that, Bumrungrad Hospital is 2.78 times more volatile than Electronic Arts. It trades about -0.22 of its total potential returns per unit of risk. Electronic Arts is currently generating about 0.46 per unit of volatility. If you would invest 12,890 in Electronic Arts on August 30, 2024 and sell it today you would earn a total of 2,843 from holding Electronic Arts or generate 22.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bumrungrad Hospital Public vs. Electronic Arts
Performance |
| Timeline |
| Bumrungrad Hospital |
| Electronic Arts |
Bumrungrad Hospital and Electronic Arts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bumrungrad Hospital and Electronic Arts
The main advantage of trading using opposite Bumrungrad Hospital and Electronic Arts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bumrungrad Hospital position performs unexpectedly, Electronic Arts 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 Electronic Arts will offset losses from the drop in Electronic Arts' long position.| Bumrungrad Hospital vs. Richter Gedeon Vegyszeti | Bumrungrad Hospital vs. Charoen Pokphand Foods | Bumrungrad Hospital vs. Superior Plus Corp | Bumrungrad Hospital vs. NMI Holdings |
| Electronic Arts vs. Apple Inc | Electronic Arts vs. Apple Inc | Electronic Arts vs. Superior Plus Corp | Electronic Arts vs. SIVERS SEMICONDUCTORS AB |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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