Correlation Between Alpha One and China Health
Can any of the company-specific risk be diversified away by investing in both Alpha One and China 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 Alpha One and China Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alpha One and China Health Management, you can compare the effects of market volatilities on Alpha One and China 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 Alpha One with a short position of China Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha One and China Health.
Diversification Opportunities for Alpha One and China Health
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Alpha and China is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Alpha One and China Health Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Health Management and Alpha One 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 Alpha One are associated (or correlated) with China Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Health Management has no effect on the direction of Alpha One i.e., Alpha One and China Health go up and down completely randomly.
Pair Corralation between Alpha One and China Health
If you would invest 0.34 in China Health Management on December 28, 2024 and sell it today you would earn a total of 0.15 from holding China Health Management or generate 44.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Alpha One vs. China Health Management
Performance |
Timeline |
Alpha One |
China Health Management |
Alpha One and China Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Alpha One and China Health
The main advantage of trading using opposite Alpha One and China Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha One position performs unexpectedly, China 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 China Health will offset losses from the drop in China Health's long position.Alpha One vs. Aviat Networks | Alpha One vs. Franklin Wireless Corp | Alpha One vs. SkyWest | Alpha One vs. Delta Air Lines |
China Health vs. Absolute Health and | China Health vs. Embrace Change Acquisition | China Health vs. Supurva Healthcare Group | China Health vs. TransAKT |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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