Correlation Between Whirlpool and Peijia Medical
Can any of the company-specific risk be diversified away by investing in both Whirlpool and Peijia Medical 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 Whirlpool and Peijia Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Whirlpool and Peijia Medical Limited, you can compare the effects of market volatilities on Whirlpool and Peijia Medical 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 Whirlpool with a short position of Peijia Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Whirlpool and Peijia Medical.
Diversification Opportunities for Whirlpool and Peijia Medical
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Whirlpool and Peijia is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Whirlpool and Peijia Medical Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peijia Medical and Whirlpool 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 Whirlpool are associated (or correlated) with Peijia Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peijia Medical has no effect on the direction of Whirlpool i.e., Whirlpool and Peijia Medical go up and down completely randomly.
Pair Corralation between Whirlpool and Peijia Medical
Assuming the 90 days horizon Whirlpool is expected to generate 1.93 times more return on investment than Peijia Medical. However, Whirlpool is 1.93 times more volatile than Peijia Medical Limited. It trades about -0.05 of its potential returns per unit of risk. Peijia Medical Limited is currently generating about -0.18 per unit of risk. If you would invest 11,120 in Whirlpool on November 5, 2024 and sell it today you would lose (705.00) from holding Whirlpool or give up 6.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Whirlpool vs. Peijia Medical Limited
Performance |
| Timeline |
| Whirlpool |
| Peijia Medical |
Whirlpool and Peijia Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Whirlpool and Peijia Medical
The main advantage of trading using opposite Whirlpool and Peijia Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Whirlpool position performs unexpectedly, Peijia Medical 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 Peijia Medical will offset losses from the drop in Peijia Medical's long position.| Whirlpool vs. Wyndham Hotels Resorts | Whirlpool vs. CVR Medical Corp | Whirlpool vs. Choice Hotels International | Whirlpool vs. BRIT AMER TOBACCO |
| Peijia Medical vs. BJs Restaurants | Peijia Medical vs. RCI Hospitality Holdings | Peijia Medical vs. HEALTHSTREAM | Peijia Medical vs. Acadia 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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |