Correlation Between Global Techs and National Health
Can any of the company-specific risk be diversified away by investing in both Global Techs and National 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 Global Techs and National Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Techs and National Health Scan, you can compare the effects of market volatilities on Global Techs and National 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 Global Techs with a short position of National Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Techs and National Health.
Diversification Opportunities for Global Techs and National Health
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and National is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Global Techs and National Health Scan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Health Scan and Global Techs 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 Techs are associated (or correlated) with National Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Health Scan has no effect on the direction of Global Techs i.e., Global Techs and National Health go up and down completely randomly.
Pair Corralation between Global Techs and National Health
If you would invest 1.80 in National Health Scan on September 1, 2024 and sell it today you would earn a total of 0.50 from holding National Health Scan or generate 27.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Global Techs vs. National Health Scan
Performance |
| Timeline |
| Global Techs |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| National Health Scan |
Global Techs and National Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Techs and National Health
The main advantage of trading using opposite Global Techs and National Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Techs position performs unexpectedly, National 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 National Health will offset losses from the drop in National Health's long position.| Global Techs vs. 1847 Holdings LLC | Global Techs vs. Alliance Recovery | Global Techs vs. Agro Capital Management | Global Techs vs. Ayala |
| National Health vs. Emergent Health Corp | National Health vs. One World Universe | National Health vs. Nextmart | National Health vs. HeadsUp Entertainment International |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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