Correlation Between Bumrungrad Hospital and Alibaba Group
Can any of the company-specific risk be diversified away by investing in both Bumrungrad Hospital and Alibaba 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 Bumrungrad Hospital and Alibaba Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bumrungrad Hospital Public and Alibaba Group Holding, you can compare the effects of market volatilities on Bumrungrad Hospital and Alibaba 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 Bumrungrad Hospital with a short position of Alibaba Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bumrungrad Hospital and Alibaba Group.
Diversification Opportunities for Bumrungrad Hospital and Alibaba Group
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bumrungrad and Alibaba is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Bumrungrad Hospital Public and Alibaba Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alibaba Group Holding and Bumrungrad Hospital 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 Bumrungrad Hospital Public are associated (or correlated) with Alibaba Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alibaba Group Holding has no effect on the direction of Bumrungrad Hospital i.e., Bumrungrad Hospital and Alibaba Group go up and down completely randomly.
Pair Corralation between Bumrungrad Hospital and Alibaba Group
Assuming the 90 days trading horizon Bumrungrad Hospital Public is expected to under-perform the Alibaba Group. But the stock apears to be less risky and, when comparing its historical volatility, Bumrungrad Hospital Public is 1.28 times less risky than Alibaba Group. The stock trades about -0.09 of its potential returns per unit of risk. The Alibaba Group Holding is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,028 in Alibaba Group Holding on December 30, 2024 and sell it today you would earn a total of 545.00 from holding Alibaba Group Holding or generate 53.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Bumrungrad Hospital Public vs. Alibaba Group Holding
Performance |
Timeline |
Bumrungrad Hospital |
Alibaba Group Holding |
Bumrungrad Hospital and Alibaba Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bumrungrad Hospital and Alibaba Group
The main advantage of trading using opposite Bumrungrad Hospital and Alibaba Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bumrungrad Hospital position performs unexpectedly, Alibaba 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 Alibaba Group will offset losses from the drop in Alibaba Group's long position.Bumrungrad Hospital vs. Ramsay Health Care | Bumrungrad Hospital vs. Richter Gedeon Vegyszeti | Bumrungrad Hospital vs. Select Medical Holdings | Bumrungrad Hospital vs. Medicover AB |
Alibaba Group vs. PLAYWAY SA ZY 10 | Alibaba Group vs. GOLDQUEST MINING | Alibaba Group vs. GALENA MINING LTD | Alibaba Group vs. De Grey Mining |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |