Correlation Between Golden Developing and Virtual Medical

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

By analyzing existing cross correlation between Golden Developing Solutions and Virtual Medical International, you can compare the effects of market volatilities on Golden Developing and Virtual Medical 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 Golden Developing with a short position of Virtual Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Developing and Virtual Medical.

Diversification Opportunities for Golden Developing and Virtual Medical

-0.77

Correlation Coefficient

Golden Developing  Virtual Medical

Pay attention - limited upside

The 3 months correlation between Golden and Virtual is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Golden Developing Solutions and Virtual Medical International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtual Medical Inte and Golden Developing 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 Golden Developing Solutions are associated (or correlated) with Virtual Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtual Medical Inte has no effect on the direction of Golden Developing i.e., Golden Developing and Virtual Medical go up and down completely randomly.

Pair Corralation between Golden Developing and Virtual Medical

Given the investment horizon of 90 days Golden Developing Solutions is expected to generate 20.0 times more return on investment than Virtual Medical. However, Golden Developing is 20.0 times more volatile than Virtual Medical International. It trades about 0.13 of its potential returns per unit of risk. Virtual Medical International is currently generating about -0.13 per unit of risk. If you would invest  0.00  in Golden Developing Solutions on December 29, 2024 and sell it today you would earn a total of  0.01  from holding Golden Developing Solutions or generate 9.223372036854776E16% return on investment over 90 days.

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

Golden Developing Solutions  vs.  Virtual Medical International

Golden Developing

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Golden Developing Solutions are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak essential indicators, Golden Developing reported solid returns over the last few months and may actually be approaching a breakup point.

Virtual Medical Inte

Risk-Adjusted Performance

Very Weak

Over the last 90 days Virtual Medical International has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's fundamental drivers remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Golden Developing and Virtual Medical

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

The idea behind Golden Developing Solutions and Virtual Medical International 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.