Correlation Between Ramsay Health and Platinum Asset
Can any of the company-specific risk be diversified away by investing in both Ramsay Health and Platinum Asset 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 Ramsay Health and Platinum Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ramsay Health Care and Platinum Asset Management, you can compare the effects of market volatilities on Ramsay Health and Platinum Asset 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 Ramsay Health with a short position of Platinum Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramsay Health and Platinum Asset.
Diversification Opportunities for Ramsay Health and Platinum Asset
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ramsay and Platinum is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Ramsay Health Care and Platinum Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Platinum Asset Management and Ramsay 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 Ramsay Health Care are associated (or correlated) with Platinum Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Platinum Asset Management has no effect on the direction of Ramsay Health i.e., Ramsay Health and Platinum Asset go up and down completely randomly.
Pair Corralation between Ramsay Health and Platinum Asset
Assuming the 90 days trading horizon Ramsay Health Care is expected to under-perform the Platinum Asset. But the stock apears to be less risky and, when comparing its historical volatility, Ramsay Health Care is 1.77 times less risky than Platinum Asset. The stock trades about -0.07 of its potential returns per unit of risk. The Platinum Asset Management is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 138.00 in Platinum Asset Management on November 2, 2024 and sell it today you would lose (67.00) from holding Platinum Asset Management or give up 48.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ramsay Health Care vs. Platinum Asset Management
Performance |
| Timeline |
| Ramsay Health Care |
| Platinum Asset Management |
Ramsay Health and Platinum Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ramsay Health and Platinum Asset
The main advantage of trading using opposite Ramsay Health and Platinum Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ramsay Health position performs unexpectedly, Platinum Asset 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 Platinum Asset will offset losses from the drop in Platinum Asset's long position.| Ramsay Health vs. Aneka Tambang Tbk | Ramsay Health vs. BHP Group Limited | Ramsay Health vs. Rio Tinto | Ramsay Health vs. Macquarie Group Ltd |
| Platinum Asset vs. Aneka Tambang Tbk | Platinum Asset vs. BHP Group Limited | Platinum Asset vs. Ecofibre | Platinum Asset vs. iShares Global Healthcare |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |