Correlation Between Viva Leisure and Oceania Healthcare
Can any of the company-specific risk be diversified away by investing in both Viva Leisure and Oceania 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 Viva Leisure and Oceania Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Viva Leisure and Oceania Healthcare, you can compare the effects of market volatilities on Viva Leisure and Oceania 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 Viva Leisure with a short position of Oceania Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viva Leisure and Oceania Healthcare.
Diversification Opportunities for Viva Leisure and Oceania Healthcare
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Viva and Oceania is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Viva Leisure and Oceania Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oceania Healthcare and Viva Leisure 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 Viva Leisure are associated (or correlated) with Oceania Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oceania Healthcare has no effect on the direction of Viva Leisure i.e., Viva Leisure and Oceania Healthcare go up and down completely randomly.
Pair Corralation between Viva Leisure and Oceania Healthcare
Assuming the 90 days trading horizon Viva Leisure is expected to generate 0.58 times more return on investment than Oceania Healthcare. However, Viva Leisure is 1.73 times less risky than Oceania Healthcare. It trades about 0.06 of its potential returns per unit of risk. Oceania Healthcare is currently generating about 0.04 per unit of risk. If you would invest 136.00 in Viva Leisure on August 29, 2024 and sell it today you would earn a total of 4.00 from holding Viva Leisure or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Viva Leisure vs. Oceania Healthcare
Performance |
| Timeline |
| Viva Leisure |
| Oceania Healthcare |
Viva Leisure and Oceania Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Viva Leisure and Oceania Healthcare
The main advantage of trading using opposite Viva Leisure and Oceania Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Viva Leisure position performs unexpectedly, Oceania 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 Oceania Healthcare will offset losses from the drop in Oceania Healthcare's long position.| Viva Leisure vs. Summit Resources Limited | Viva Leisure vs. Ecofibre | Viva Leisure vs. iShares Global Healthcare | Viva Leisure vs. Adriatic Metals Plc |
| Oceania Healthcare vs. Inventis | Oceania Healthcare vs. PM Capital Global | Oceania Healthcare vs. Macquarie Group Ltd | Oceania Healthcare vs. Wam Leaders |
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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