Correlation Between Global Health and Ras Technology
Can any of the company-specific risk be diversified away by investing in both Global Health and Ras Technology 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 Global Health and Ras Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Health and Ras Technology Holdings, you can compare the effects of market volatilities on Global Health and Ras Technology 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 Global Health with a short position of Ras Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Health and Ras Technology.
Diversification Opportunities for Global Health and Ras Technology
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Ras is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Global Health and Ras Technology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ras Technology Holdings and Global 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 Global Health are associated (or correlated) with Ras Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ras Technology Holdings has no effect on the direction of Global Health i.e., Global Health and Ras Technology go up and down completely randomly.
Pair Corralation between Global Health and Ras Technology
Assuming the 90 days trading horizon Global Health is expected to generate 1.92 times less return on investment than Ras Technology. In addition to that, Global Health is 1.42 times more volatile than Ras Technology Holdings. It trades about 0.02 of its total potential returns per unit of risk. Ras Technology Holdings is currently generating about 0.07 per unit of volatility. If you would invest 49.00 in Ras Technology Holdings on August 31, 2024 and sell it today you would earn a total of 47.00 from holding Ras Technology Holdings or generate 95.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Health vs. Ras Technology Holdings
Performance |
| Timeline |
| Global Health |
| Ras Technology Holdings |
Global Health and Ras Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Health and Ras Technology
The main advantage of trading using opposite Global Health and Ras Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Health position performs unexpectedly, Ras Technology 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 Ras Technology will offset losses from the drop in Ras Technology's long position.| Global Health vs. Aneka Tambang Tbk | Global Health vs. Woolworths | Global Health vs. Commonwealth Bank | Global Health vs. BHP Group Limited |
| Ras Technology vs. Infomedia | Ras Technology vs. AiMedia Technologies | Ras Technology vs. Black Rock Mining | Ras Technology vs. DY6 Metals |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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