Correlation Between JD Health and Raffles Medical
Can any of the company-specific risk be diversified away by investing in both JD Health and Raffles Medical 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 JD Health and Raffles Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Health International and Raffles Medical Group, you can compare the effects of market volatilities on JD Health and Raffles Medical 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 JD Health with a short position of Raffles Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Health and Raffles Medical.
Diversification Opportunities for JD Health and Raffles Medical
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between JDHIY and Raffles is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding JD Health International and Raffles Medical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raffles Medical Group and JD 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 JD Health International are associated (or correlated) with Raffles Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raffles Medical Group has no effect on the direction of JD Health i.e., JD Health and Raffles Medical go up and down completely randomly.
Pair Corralation between JD Health and Raffles Medical
Assuming the 90 days horizon JD Health International is expected to under-perform the Raffles Medical. In addition to that, JD Health is 2.24 times more volatile than Raffles Medical Group. It trades about -0.03 of its total potential returns per unit of risk. Raffles Medical Group is currently generating about -0.07 per unit of volatility. If you would invest 77.00 in Raffles Medical Group on September 12, 2024 and sell it today you would lose (3.00) from holding Raffles Medical Group or give up 3.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 21.46% |
| Values | Daily Returns |
JD Health International vs. Raffles Medical Group
Performance |
| Timeline |
| JD Health International |
| Raffles Medical Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
JD Health and Raffles Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Health and Raffles Medical
The main advantage of trading using opposite JD Health and Raffles Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Health position performs unexpectedly, Raffles Medical 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 Raffles Medical will offset losses from the drop in Raffles Medical's long position.| JD Health vs. Pennant Group | JD Health vs. Encompass Health Corp | JD Health vs. Enhabit | JD Health vs. Concord Medical Services |
| Raffles Medical vs. Pennant Group | Raffles Medical vs. Surgery Partners | Raffles Medical vs. The Ensign Group | Raffles Medical vs. Encompass Health Corp |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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