Correlation Between Japan Post and Sonic Healthcare
Can any of the company-specific risk be diversified away by investing in both Japan Post and Sonic Healthcare 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 Japan Post and Sonic Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Japan Post Holdings and Sonic Healthcare Ltd, you can compare the effects of market volatilities on Japan Post and Sonic Healthcare 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 Japan Post with a short position of Sonic Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Japan Post and Sonic Healthcare.
Diversification Opportunities for Japan Post and Sonic Healthcare
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Japan and Sonic is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Japan Post Holdings and Sonic Healthcare Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonic Healthcare and Japan Post 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 Japan Post Holdings are associated (or correlated) with Sonic Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonic Healthcare has no effect on the direction of Japan Post i.e., Japan Post and Sonic Healthcare go up and down completely randomly.
Pair Corralation between Japan Post and Sonic Healthcare
If you would invest 1,831 in Sonic Healthcare Ltd on August 25, 2024 and sell it today you would earn a total of 29.00 from holding Sonic Healthcare Ltd or generate 1.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
Japan Post Holdings vs. Sonic Healthcare Ltd
Performance |
| Timeline |
| Japan Post Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Sonic Healthcare |
Japan Post and Sonic Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Japan Post and Sonic Healthcare
The main advantage of trading using opposite Japan Post and Sonic Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Japan Post position performs unexpectedly, Sonic Healthcare 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 Sonic Healthcare will offset losses from the drop in Sonic Healthcare's long position.| Japan Post vs. Huntington Bancshares Incorporated | Japan Post vs. Fifth Third Bancorp | Japan Post vs. MT Bank | Japan Post vs. Citizens Financial Group, |
| Sonic Healthcare vs. Neuronetics | Sonic Healthcare vs. Intelligent Bio Solutions | Sonic Healthcare vs. Biodesix | Sonic Healthcare vs. Precipio |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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