Correlation Between SS Healthcare and Onyx Healthcare

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

By analyzing existing cross correlation between SS Healthcare Holding and Onyx Healthcare, you can compare the effects of market volatilities on SS Healthcare and Onyx 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 SS Healthcare with a short position of Onyx Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of SS Healthcare and Onyx Healthcare.

Diversification Opportunities for SS Healthcare and Onyx Healthcare

0.0

Correlation Coefficient

SS Healthcare  Onyx Healthcare

Pay attention - limited upside

The 3 months correlation between 4198 and Onyx is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SS Healthcare Holding and Onyx Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onyx Healthcare and SS Healthcare 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 SS Healthcare Holding are associated (or correlated) with Onyx Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onyx Healthcare has no effect on the direction of SS Healthcare i.e., SS Healthcare and Onyx Healthcare go up and down completely randomly.

Pair Corralation between SS Healthcare and Onyx Healthcare

Assuming the 90 days trading horizon SS Healthcare Holding is expected to generate 0.97 times more return on investment than Onyx Healthcare. However, SS Healthcare Holding is 1.03 times less risky than Onyx Healthcare. It trades about -0.01 of its potential returns per unit of risk. Onyx Healthcare is currently generating about -0.01 per unit of risk. If you would invest  3,200  in SS Healthcare Holding on December 29, 2024 and sell it today you would lose (80.00) from holding SS Healthcare Holding or give up 2.5% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

SS Healthcare Holding  vs.  Onyx Healthcare

SS Healthcare Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days SS Healthcare Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, SS Healthcare is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Onyx Healthcare

Risk-Adjusted Performance

Very Weak

Over the last 90 days Onyx Healthcare has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Onyx Healthcare is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with SS Healthcare and Onyx Healthcare

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

The idea behind SS Healthcare Holding and Onyx Healthcare 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.

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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.