Correlation Between Asiri Surgical and Asian Hotels

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Can any of the company-specific risk be diversified away by investing in both Asiri Surgical and Asian Hotels 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 Asiri Surgical and Asian Hotels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asiri Surgical Hospital and Asian Hotels and, you can compare the effects of market volatilities on Asiri Surgical and Asian Hotels 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 Asiri Surgical with a short position of Asian Hotels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asiri Surgical and Asian Hotels.

Diversification Opportunities for Asiri Surgical and Asian Hotels

AsiriAsianDiversified AwayAsiriAsianDiversified Away100%
-0.45
  Correlation Coefficient

Very good diversification

The 3 months correlation between Asiri and Asian is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Asiri Surgical Hospital and Asian Hotels and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asian Hotels and Asiri Surgical 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 Asiri Surgical Hospital are associated (or correlated) with Asian Hotels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asian Hotels has no effect on the direction of Asiri Surgical i.e., Asiri Surgical and Asian Hotels go up and down completely randomly.

Pair Corralation between Asiri Surgical and Asian Hotels

Assuming the 90 days trading horizon Asiri Surgical Hospital is expected to under-perform the Asian Hotels. In addition to that, Asiri Surgical is 1.08 times more volatile than Asian Hotels and. It trades about -0.02 of its total potential returns per unit of risk. Asian Hotels and is currently generating about 0.13 per unit of volatility. If you would invest  5,280  in Asian Hotels and on September 20, 2024 and sell it today you would earn a total of  700.00  from holding Asian Hotels and or generate 13.26% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Asiri Surgical Hospital  vs.  Asian Hotels and

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec 05101520
JavaScript chart by amCharts 3.21.15AMSLN0000 AHPLN0000
       Timeline  
Asiri Surgical Hospital 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Asiri Surgical Hospital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Asiri Surgical is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec10.610.81111.211.411.611.812
Asian Hotels 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Asian Hotels and are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Asian Hotels sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec52545658606264

Asiri Surgical and Asian Hotels Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.84-4.37-2.91-1.440.021.452.924.395.87 0.020.040.060.080.100.12
JavaScript chart by amCharts 3.21.15AMSLN0000 AHPLN0000
       Returns  

Pair Trading with Asiri Surgical and Asian Hotels

The main advantage of trading using opposite Asiri Surgical and Asian Hotels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asiri Surgical position performs unexpectedly, Asian Hotels 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 Asian Hotels will offset losses from the drop in Asian Hotels' long position.
The idea behind Asiri Surgical Hospital and Asian Hotels and 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

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