Correlation Between Chison Medical and By Health

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

By analyzing existing cross correlation between Chison Medical Technologies and By health, you can compare the effects of market volatilities on Chison Medical and By Health 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 Chison Medical with a short position of By Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chison Medical and By Health.

Diversification Opportunities for Chison Medical and By Health

0.3

Correlation Coefficient

Chison Medical  By Health

Weak diversification

The 3 months correlation between Chison and 300146 is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Chison Medical Technologies and By health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on By health and Chison Medical 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 Chison Medical Technologies are associated (or correlated) with By Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of By health has no effect on the direction of Chison Medical i.e., Chison Medical and By Health go up and down completely randomly.

Pair Corralation between Chison Medical and By Health

Assuming the 90 days trading horizon Chison Medical Technologies is expected to under-perform the By Health. In addition to that, Chison Medical is 1.04 times more volatile than By health. It trades about -0.5 of its total potential returns per unit of risk. By health is currently generating about -0.28 per unit of volatility. If you would invest  1,271  in By health on October 10, 2024 and sell it today you would lose (117.00) from holding By health or give up 9.21% of portfolio value over 90 days.

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

Chison Medical Technologies  vs.  By health

Chison Medical Techn

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chison Medical Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Chison Medical is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

By health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days By health has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Chison Medical and By Health

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

The idea behind Chison Medical Technologies and By health 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.