Correlation Between CHINA DEVELOPMENT and Icares Medicus
Can any of the company-specific risk be diversified away by investing in both CHINA DEVELOPMENT and Icares Medicus 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 CHINA DEVELOPMENT and Icares Medicus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHINA DEVELOPMENT FINANCIAL and Icares Medicus, you can compare the effects of market volatilities on CHINA DEVELOPMENT and Icares Medicus 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 CHINA DEVELOPMENT with a short position of Icares Medicus. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHINA DEVELOPMENT and Icares Medicus.
Diversification Opportunities for CHINA DEVELOPMENT and Icares Medicus
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CHINA and Icares is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding CHINA DEVELOPMENT FINANCIAL and Icares Medicus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Icares Medicus and CHINA DEVELOPMENT 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 CHINA DEVELOPMENT FINANCIAL are associated (or correlated) with Icares Medicus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Icares Medicus has no effect on the direction of CHINA DEVELOPMENT i.e., CHINA DEVELOPMENT and Icares Medicus go up and down completely randomly.
Pair Corralation between CHINA DEVELOPMENT and Icares Medicus
Assuming the 90 days trading horizon CHINA DEVELOPMENT FINANCIAL is expected to generate 0.16 times more return on investment than Icares Medicus. However, CHINA DEVELOPMENT FINANCIAL is 6.25 times less risky than Icares Medicus. It trades about 0.14 of its potential returns per unit of risk. Icares Medicus is currently generating about 0.01 per unit of risk. If you would invest 675.00 in CHINA DEVELOPMENT FINANCIAL on September 25, 2024 and sell it today you would earn a total of 109.00 from holding CHINA DEVELOPMENT FINANCIAL or generate 16.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
CHINA DEVELOPMENT FINANCIAL vs. Icares Medicus
Performance |
Timeline |
CHINA DEVELOPMENT |
Icares Medicus |
CHINA DEVELOPMENT and Icares Medicus Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CHINA DEVELOPMENT and Icares Medicus
The main advantage of trading using opposite CHINA DEVELOPMENT and Icares Medicus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHINA DEVELOPMENT position performs unexpectedly, Icares Medicus 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 Icares Medicus will offset losses from the drop in Icares Medicus' long position.CHINA DEVELOPMENT vs. Fubon Financial Holding | CHINA DEVELOPMENT vs. CTBC Financial Holding | CHINA DEVELOPMENT vs. Khgears International Limited | CHINA DEVELOPMENT vs. Eva Airways Corp |
Icares Medicus vs. Taichung Commercial Bank | Icares Medicus vs. CTBC Financial Holding | Icares Medicus vs. FDC International Hotels | Icares Medicus vs. CHINA DEVELOPMENT FINANCIAL |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Global Correlations Find global opportunities by holding instruments from different markets | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing |