Correlation Between Sanbo Hospital and Puya Semiconductor

Can any of the company-specific risk be diversified away by investing in both Sanbo Hospital and Puya Semiconductor 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 Sanbo Hospital and Puya Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sanbo Hospital Management and Puya Semiconductor Shanghai, you can compare the effects of market volatilities on Sanbo Hospital and Puya Semiconductor 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 Sanbo Hospital with a short position of Puya Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanbo Hospital and Puya Semiconductor.

Diversification Opportunities for Sanbo Hospital and Puya Semiconductor

0.34

Correlation Coefficient

Sanbo Hospital  Puya Semiconductor

Weak diversification

The 3 months correlation between Sanbo and Puya is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sanbo Hospital Management and Puya Semiconductor Shanghai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puya Semiconductor and Sanbo Hospital 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 Sanbo Hospital Management are associated (or correlated) with Puya Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puya Semiconductor has no effect on the direction of Sanbo Hospital i.e., Sanbo Hospital and Puya Semiconductor go up and down completely randomly.

Pair Corralation between Sanbo Hospital and Puya Semiconductor

Assuming the 90 days trading horizon Sanbo Hospital is expected to generate 3.77 times less return on investment than Puya Semiconductor. But when comparing it to its historical volatility, Sanbo Hospital Management is 1.27 times less risky than Puya Semiconductor. It trades about 0.04 of its potential returns per unit of risk. Puya Semiconductor Shanghai is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  8,052  in Puya Semiconductor Shanghai on October 10, 2024 and sell it today you would earn a total of  2,549  from holding Puya Semiconductor Shanghai or generate 31.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Sanbo Hospital Management  vs.  Puya Semiconductor Shanghai

Sanbo Hospital Management

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sanbo Hospital Management are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Sanbo Hospital may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Puya Semiconductor

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Puya Semiconductor Shanghai are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Puya Semiconductor sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sanbo Hospital and Puya Semiconductor

The main advantage of trading using opposite Sanbo Hospital and Puya Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanbo Hospital position performs unexpectedly, Puya Semiconductor 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 Puya Semiconductor will offset losses from the drop in Puya Semiconductor's long position.

The idea behind Sanbo Hospital Management and Puya Semiconductor Shanghai pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.