Correlation Between MEDIPAL HOLDINGS and SINOPHARM GROUP

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

By analyzing existing cross correlation between MEDIPAL HOLDINGS P and SINOPHARM GROUP 15ON, you can compare the effects of market volatilities on MEDIPAL HOLDINGS and SINOPHARM GROUP 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 MEDIPAL HOLDINGS with a short position of SINOPHARM GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDIPAL HOLDINGS and SINOPHARM GROUP.

Diversification Opportunities for MEDIPAL HOLDINGS and SINOPHARM GROUP

0.0

Correlation Coefficient

MEDIPAL HOLDINGS  SINOPHARM GROUP

Pay attention - limited upside

The 3 months correlation between MEDIPAL and SINOPHARM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MEDIPAL HOLDINGS P and SINOPHARM GROUP 15ON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINOPHARM GROUP 15ON and MEDIPAL HOLDINGS 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 MEDIPAL HOLDINGS P are associated (or correlated) with SINOPHARM GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SINOPHARM GROUP 15ON has no effect on the direction of MEDIPAL HOLDINGS i.e., MEDIPAL HOLDINGS and SINOPHARM GROUP go up and down completely randomly.

Pair Corralation between MEDIPAL HOLDINGS and SINOPHARM GROUP

If you would invest  1,220  in SINOPHARM GROUP 15ON on October 10, 2024 and sell it today you would earn a total of  30.00  from holding SINOPHARM GROUP 15ON or generate 2.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.88%
Values	Daily Returns

MEDIPAL HOLDINGS P  vs.  SINOPHARM GROUP 15ON

MEDIPAL HOLDINGS P

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MEDIPAL HOLDINGS P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, MEDIPAL HOLDINGS is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

SINOPHARM GROUP 15ON

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SINOPHARM GROUP 15ON are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, SINOPHARM GROUP is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with MEDIPAL HOLDINGS and SINOPHARM GROUP

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

The idea behind MEDIPAL HOLDINGS P and SINOPHARM GROUP 15ON 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.