Correlation Between China Health and CTR Investments
Can any of the company-specific risk be diversified away by investing in both China Health and CTR Investments 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 China Health and CTR Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Health Management and CTR Investments Consulting, you can compare the effects of market volatilities on China Health and CTR Investments 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 China Health with a short position of CTR Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Health and CTR Investments.
Diversification Opportunities for China Health and CTR Investments
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between China and CTR is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding China Health Management and CTR Investments Consulting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CTR Investments Cons and China Health 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 China Health Management are associated (or correlated) with CTR Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CTR Investments Cons has no effect on the direction of China Health i.e., China Health and CTR Investments go up and down completely randomly.
Pair Corralation between China Health and CTR Investments
Given the investment horizon of 90 days China Health is expected to generate 1.82 times less return on investment than CTR Investments. But when comparing it to its historical volatility, China Health Management is 1.35 times less risky than CTR Investments. It trades about 0.05 of its potential returns per unit of risk. CTR Investments Consulting is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.08 in CTR Investments Consulting on August 30, 2024 and sell it today you would lose (0.05) from holding CTR Investments Consulting or give up 62.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Health Management vs. CTR Investments Consulting
Performance |
| Timeline |
| China Health Management |
| CTR Investments Cons |
China Health and CTR Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Health and CTR Investments
The main advantage of trading using opposite China Health and CTR Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Health position performs unexpectedly, CTR Investments 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 CTR Investments will offset losses from the drop in CTR Investments' long position.| China Health vs. HeartCore Enterprises | China Health vs. Trust Stamp | China Health vs. Quhuo | China Health vs. C3 Ai Inc |
| CTR Investments vs. Green Planet Bio | CTR Investments vs. Azure Holding Group | CTR Investments vs. Four Leaf Acquisition | CTR Investments vs. Opus Magnum Ameris |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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