Correlation Between SINOPHARM GROUP and Henry Schein
Can any of the company-specific risk be diversified away by investing in both SINOPHARM GROUP and Henry Schein 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 SINOPHARM GROUP and Henry Schein into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SINOPHARM GROUP 15ON and Henry Schein, you can compare the effects of market volatilities on SINOPHARM GROUP and Henry Schein 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 SINOPHARM GROUP with a short position of Henry Schein. Check out your portfolio center. Please also check ongoing floating volatility patterns of SINOPHARM GROUP and Henry Schein.
Diversification Opportunities for SINOPHARM GROUP and Henry Schein
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SINOPHARM and Henry is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding SINOPHARM GROUP 15ON and Henry Schein in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henry Schein and SINOPHARM GROUP 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 SINOPHARM GROUP 15ON are associated (or correlated) with Henry Schein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henry Schein has no effect on the direction of SINOPHARM GROUP i.e., SINOPHARM GROUP and Henry Schein go up and down completely randomly.
Pair Corralation between SINOPHARM GROUP and Henry Schein
Assuming the 90 days trading horizon SINOPHARM GROUP is expected to generate 1.69 times less return on investment than Henry Schein. But when comparing it to its historical volatility, SINOPHARM GROUP 15ON is 1.11 times less risky than Henry Schein. It trades about 0.17 of its potential returns per unit of risk. Henry Schein is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 6,420 in Henry Schein on September 1, 2024 and sell it today you would earn a total of 904.00 from holding Henry Schein or generate 14.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SINOPHARM GROUP 15ON vs. Henry Schein
Performance |
| Timeline |
| SINOPHARM GROUP 15ON |
| Henry Schein |
SINOPHARM GROUP and Henry Schein Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SINOPHARM GROUP and Henry Schein
The main advantage of trading using opposite SINOPHARM GROUP and Henry Schein positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SINOPHARM GROUP position performs unexpectedly, Henry Schein 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 Henry Schein will offset losses from the drop in Henry Schein's long position.| SINOPHARM GROUP vs. Cardinal Health | SINOPHARM GROUP vs. Henry Schein | SINOPHARM GROUP vs. Shanghai Pharmaceuticals Holding | SINOPHARM GROUP vs. Sinopharm Group Co |
| Henry Schein vs. Cardinal Health | Henry Schein vs. Shanghai Pharmaceuticals Holding | Henry Schein vs. Sinopharm Group Co | Henry Schein vs. SINOPHARM GROUP 15ON |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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