Correlation Between Jinhua Capital and WELL Health
Can any of the company-specific risk be diversified away by investing in both Jinhua Capital and WELL 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 Jinhua Capital and WELL Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jinhua Capital and WELL Health Technologies, you can compare the effects of market volatilities on Jinhua Capital and WELL 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 Jinhua Capital with a short position of WELL Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinhua Capital and WELL Health.
Diversification Opportunities for Jinhua Capital and WELL Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jinhua and WELL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Jinhua Capital and WELL Health Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WELL Health Technologies and Jinhua Capital 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 Jinhua Capital are associated (or correlated) with WELL Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WELL Health Technologies has no effect on the direction of Jinhua Capital i.e., Jinhua Capital and WELL Health go up and down completely randomly.
Pair Corralation between Jinhua Capital and WELL Health
Assuming the 90 days horizon Jinhua Capital is expected to generate 7.18 times more return on investment than WELL Health. However, Jinhua Capital is 7.18 times more volatile than WELL Health Technologies. It trades about 0.04 of its potential returns per unit of risk. WELL Health Technologies is currently generating about 0.15 per unit of risk. If you would invest 1.00 in Jinhua Capital on September 3, 2024 and sell it today you would lose (0.50) from holding Jinhua Capital or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinhua Capital vs. WELL Health Technologies
Performance |
| Timeline |
| Jinhua Capital |
| WELL Health Technologies |
Jinhua Capital and WELL Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinhua Capital and WELL Health
The main advantage of trading using opposite Jinhua Capital and WELL Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinhua Capital position performs unexpectedly, WELL 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 WELL Health will offset losses from the drop in WELL Health's long position.| Jinhua Capital vs. WELL Health Technologies | Jinhua Capital vs. Monument Mining Limited | Jinhua Capital vs. CVS HEALTH CDR | Jinhua Capital vs. UnitedHealth Group CDR |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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