Correlation Between Identi Healthcare and Wesure Global
Can any of the company-specific risk be diversified away by investing in both Identi Healthcare and Wesure Global 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 Identi Healthcare and Wesure Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Identi Healthcare and Wesure Global Tech, you can compare the effects of market volatilities on Identi Healthcare and Wesure Global 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 Identi Healthcare with a short position of Wesure Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Identi Healthcare and Wesure Global.
Diversification Opportunities for Identi Healthcare and Wesure Global
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Identi and Wesure is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Identi Healthcare and Wesure Global Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wesure Global Tech and Identi Healthcare 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 Identi Healthcare are associated (or correlated) with Wesure Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wesure Global Tech has no effect on the direction of Identi Healthcare i.e., Identi Healthcare and Wesure Global go up and down completely randomly.
Pair Corralation between Identi Healthcare and Wesure Global
Assuming the 90 days trading horizon Identi Healthcare is expected to generate 6.29 times more return on investment than Wesure Global. However, Identi Healthcare is 6.29 times more volatile than Wesure Global Tech. It trades about 0.39 of its potential returns per unit of risk. Wesure Global Tech is currently generating about 0.19 per unit of risk. If you would invest 18,260 in Identi Healthcare on October 24, 2024 and sell it today you would earn a total of 35,810 from holding Identi Healthcare or generate 196.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Identi Healthcare vs. Wesure Global Tech
Performance |
| Timeline |
| Identi Healthcare |
| Wesure Global Tech |
Identi Healthcare and Wesure Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Identi Healthcare and Wesure Global
The main advantage of trading using opposite Identi Healthcare and Wesure Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Identi Healthcare position performs unexpectedly, Wesure Global 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 Wesure Global will offset losses from the drop in Wesure Global's long position.| Identi Healthcare vs. Wesure Global Tech | Identi Healthcare vs. Nrgene Technologies | Identi Healthcare vs. Priortech | Identi Healthcare vs. Iargento Hi Tech |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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