Correlation Between CeCors and Meihua International
Can any of the company-specific risk be diversified away by investing in both CeCors and Meihua International 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 CeCors and Meihua International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CeCors Inc and Meihua International Medical, you can compare the effects of market volatilities on CeCors and Meihua International 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 CeCors with a short position of Meihua International. Check out your portfolio center. Please also check ongoing floating volatility patterns of CeCors and Meihua International.
Diversification Opportunities for CeCors and Meihua International
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CeCors and Meihua is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding CeCors Inc and Meihua International Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meihua International and CeCors 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 CeCors Inc are associated (or correlated) with Meihua International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meihua International has no effect on the direction of CeCors i.e., CeCors and Meihua International go up and down completely randomly.
Pair Corralation between CeCors and Meihua International
Given the investment horizon of 90 days CeCors Inc is expected to generate 1.47 times more return on investment than Meihua International. However, CeCors is 1.47 times more volatile than Meihua International Medical. It trades about 0.12 of its potential returns per unit of risk. Meihua International Medical is currently generating about -0.04 per unit of risk. If you would invest 1.88 in CeCors Inc on August 25, 2024 and sell it today you would earn a total of 1.00 from holding CeCors Inc or generate 53.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CeCors Inc vs. Meihua International Medical
Performance |
| Timeline |
| CeCors Inc |
| Meihua International |
CeCors and Meihua International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CeCors and Meihua International
The main advantage of trading using opposite CeCors and Meihua International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CeCors position performs unexpectedly, Meihua International 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 Meihua International will offset losses from the drop in Meihua International's long position.| CeCors vs. BioLife Sciences | CeCors vs. Innerscope Advertising Agency | CeCors vs. GlucoTrack | CeCors vs. Sharps Technology |
| Meihua International vs. Heartbeam | Meihua International vs. EUDA Health Holdings | Meihua International vs. Nutex Health | Meihua International vs. Healthcare Triangle |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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