Correlation Between IHH Healthcare and Old Dominion
Can any of the company-specific risk be diversified away by investing in both IHH Healthcare and Old Dominion 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 IHH Healthcare and Old Dominion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IHH Healthcare Berhad and Old Dominion Freight, you can compare the effects of market volatilities on IHH Healthcare and Old Dominion 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 IHH Healthcare with a short position of Old Dominion. Check out your portfolio center. Please also check ongoing floating volatility patterns of IHH Healthcare and Old Dominion.
Diversification Opportunities for IHH Healthcare and Old Dominion
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IHH and Old is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding IHH Healthcare Berhad and Old Dominion Freight in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Dominion Freight and IHH 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 IHH Healthcare Berhad are associated (or correlated) with Old Dominion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Dominion Freight has no effect on the direction of IHH Healthcare i.e., IHH Healthcare and Old Dominion go up and down completely randomly.
Pair Corralation between IHH Healthcare and Old Dominion
Assuming the 90 days horizon IHH Healthcare Berhad is expected to under-perform the Old Dominion. But the pink sheet apears to be less risky and, when comparing its historical volatility, IHH Healthcare Berhad is 1.29 times less risky than Old Dominion. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Old Dominion Freight is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 15,579 in Old Dominion Freight on October 7, 2024 and sell it today you would earn a total of 2,512 from holding Old Dominion Freight or generate 16.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 67.34% |
| Values | Daily Returns |
IHH Healthcare Berhad vs. Old Dominion Freight
Performance |
| Timeline |
| IHH Healthcare Berhad |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Old Dominion Freight |
IHH Healthcare and Old Dominion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IHH Healthcare and Old Dominion
The main advantage of trading using opposite IHH Healthcare and Old Dominion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IHH Healthcare position performs unexpectedly, Old Dominion 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 Old Dominion will offset losses from the drop in Old Dominion's long position.| IHH Healthcare vs. Gatos Silver | IHH Healthcare vs. Dave Busters Entertainment | IHH Healthcare vs. Hunter Creek Mining | IHH Healthcare vs. ioneer Ltd American |
| Old Dominion vs. ArcBest Corp | Old Dominion vs. Marten Transport | Old Dominion vs. Werner Enterprises | Old Dominion vs. Knight Transportation |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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