Correlation Between RYMAN HEALTHCAR and Geely Automobile
Can any of the company-specific risk be diversified away by investing in both RYMAN HEALTHCAR and Geely Automobile 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 RYMAN HEALTHCAR and Geely Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RYMAN HEALTHCAR and Geely Automobile Holdings, you can compare the effects of market volatilities on RYMAN HEALTHCAR and Geely Automobile 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 RYMAN HEALTHCAR with a short position of Geely Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of RYMAN HEALTHCAR and Geely Automobile.
Diversification Opportunities for RYMAN HEALTHCAR and Geely Automobile
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between RYMAN and Geely is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding RYMAN HEALTHCAR and Geely Automobile Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geely Automobile Holdings and RYMAN HEALTHCAR 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 RYMAN HEALTHCAR are associated (or correlated) with Geely Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geely Automobile Holdings has no effect on the direction of RYMAN HEALTHCAR i.e., RYMAN HEALTHCAR and Geely Automobile go up and down completely randomly.
Pair Corralation between RYMAN HEALTHCAR and Geely Automobile
Assuming the 90 days trading horizon RYMAN HEALTHCAR is expected to generate 1.16 times more return on investment than Geely Automobile. However, RYMAN HEALTHCAR is 1.16 times more volatile than Geely Automobile Holdings. It trades about 0.08 of its potential returns per unit of risk. Geely Automobile Holdings is currently generating about -0.33 per unit of risk. If you would invest 239.00 in RYMAN HEALTHCAR on October 11, 2024 and sell it today you would earn a total of 6.00 from holding RYMAN HEALTHCAR or generate 2.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
RYMAN HEALTHCAR vs. Geely Automobile Holdings
Performance |
| Timeline |
| RYMAN HEALTHCAR |
| Geely Automobile Holdings |
RYMAN HEALTHCAR and Geely Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RYMAN HEALTHCAR and Geely Automobile
The main advantage of trading using opposite RYMAN HEALTHCAR and Geely Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RYMAN HEALTHCAR position performs unexpectedly, Geely Automobile 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 Geely Automobile will offset losses from the drop in Geely Automobile's long position.| RYMAN HEALTHCAR vs. Geely Automobile Holdings | RYMAN HEALTHCAR vs. Charter Communications | RYMAN HEALTHCAR vs. SINGAPORE AIRLINES | RYMAN HEALTHCAR vs. International Consolidated Airlines |
| Geely Automobile vs. Hemisphere Energy Corp | Geely Automobile vs. Nippon Steel | Geely Automobile vs. Shenandoah Telecommunications | Geely Automobile vs. Liberty Broadband |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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