Correlation Between Natural Health and PLAY2CHILL
Can any of the company-specific risk be diversified away by investing in both Natural Health and PLAY2CHILL 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 Natural Health and PLAY2CHILL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Natural Health Trends and PLAY2CHILL SA ZY, you can compare the effects of market volatilities on Natural Health and PLAY2CHILL 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 Natural Health with a short position of PLAY2CHILL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Natural Health and PLAY2CHILL.
Diversification Opportunities for Natural Health and PLAY2CHILL
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Natural and PLAY2CHILL is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Natural Health Trends and PLAY2CHILL SA ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAY2CHILL SA ZY and Natural 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 Natural Health Trends are associated (or correlated) with PLAY2CHILL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAY2CHILL SA ZY has no effect on the direction of Natural Health i.e., Natural Health and PLAY2CHILL go up and down completely randomly.
Pair Corralation between Natural Health and PLAY2CHILL
Assuming the 90 days trading horizon Natural Health Trends is expected to generate 2.86 times more return on investment than PLAY2CHILL. However, Natural Health is 2.86 times more volatile than PLAY2CHILL SA ZY. It trades about 0.05 of its potential returns per unit of risk. PLAY2CHILL SA ZY is currently generating about 0.06 per unit of risk. If you would invest 512.00 in Natural Health Trends on August 28, 2024 and sell it today you would earn a total of 13.00 from holding Natural Health Trends or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Natural Health Trends vs. PLAY2CHILL SA ZY
Performance |
| Timeline |
| Natural Health Trends |
| PLAY2CHILL SA ZY |
Natural Health and PLAY2CHILL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Natural Health and PLAY2CHILL
The main advantage of trading using opposite Natural Health and PLAY2CHILL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Natural Health position performs unexpectedly, PLAY2CHILL 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 PLAY2CHILL will offset losses from the drop in PLAY2CHILL's long position.| Natural Health vs. Fast Retailing Co | Natural Health vs. Burlington Stores | Natural Health vs. Ross Stores | Natural Health vs. RETAIL FOOD GROUP |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |