Correlation Between Concord Medical and JD Health
Can any of the company-specific risk be diversified away by investing in both Concord Medical and JD 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 Concord Medical and JD Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concord Medical Services and JD Health International, you can compare the effects of market volatilities on Concord Medical and JD 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 Concord Medical with a short position of JD Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Medical and JD Health.
Diversification Opportunities for Concord Medical and JD Health
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Concord and JDHIY is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Concord Medical Services and JD Health International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Health International and Concord 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 Concord Medical Services are associated (or correlated) with JD Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Health International has no effect on the direction of Concord Medical i.e., Concord Medical and JD Health go up and down completely randomly.
Pair Corralation between Concord Medical and JD Health
Considering the 90-day investment horizon Concord Medical Services is expected to generate 6.69 times more return on investment than JD Health. However, Concord Medical is 6.69 times more volatile than JD Health International. It trades about 0.04 of its potential returns per unit of risk. JD Health International is currently generating about -0.03 per unit of risk. If you would invest 1,110 in Concord Medical Services on September 2, 2024 and sell it today you would lose (601.00) from holding Concord Medical Services or give up 54.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Concord Medical Services vs. JD Health International
Performance |
| Timeline |
| Concord Medical Services |
| JD Health International |
Concord Medical and JD Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Medical and JD Health
The main advantage of trading using opposite Concord Medical and JD Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Medical position performs unexpectedly, JD 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 JD Health will offset losses from the drop in JD Health's long position.| Concord Medical vs. Pennant Group | Concord Medical vs. Encompass Health Corp | Concord Medical vs. Enhabit | Concord Medical vs. National HealthCare |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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