Correlation Between China Health and Forwardly
Can any of the company-specific risk be diversified away by investing in both China Health and Forwardly 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 Forwardly 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 Forwardly, you can compare the effects of market volatilities on China Health and Forwardly 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 Forwardly. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Health and Forwardly.
Diversification Opportunities for China Health and Forwardly
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between China and Forwardly is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding China Health Management and Forwardly in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forwardly 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 Forwardly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forwardly has no effect on the direction of China Health i.e., China Health and Forwardly go up and down completely randomly.
Pair Corralation between China Health and Forwardly
Given the investment horizon of 90 days China Health Management is expected to generate 1.44 times more return on investment than Forwardly. However, China Health is 1.44 times more volatile than Forwardly. It trades about 0.06 of its potential returns per unit of risk. Forwardly is currently generating about -0.02 per unit of risk. If you would invest 0.47 in China Health Management on August 25, 2024 and sell it today you would earn a total of 0.14 from holding China Health Management or generate 29.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Health Management vs. Forwardly
Performance |
| Timeline |
| China Health Management |
| Forwardly |
China Health and Forwardly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Health and Forwardly
The main advantage of trading using opposite China Health and Forwardly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Health position performs unexpectedly, Forwardly 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 Forwardly will offset losses from the drop in Forwardly's long position.| China Health vs. Boxlight Corp Class | China Health vs. Siyata Mobile | China Health vs. ClearOne | China Health vs. HUMANA INC |
| Forwardly vs. Humbl Inc | Forwardly vs. Social Life Network | Forwardly vs. Enzolytics | Forwardly vs. NSAV Holding |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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