Correlation Between Pintec Technology and Cardinal Health
Can any of the company-specific risk be diversified away by investing in both Pintec Technology and Cardinal 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 Pintec Technology and Cardinal Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pintec Technology Holdings and Cardinal Health, you can compare the effects of market volatilities on Pintec Technology and Cardinal 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 Pintec Technology with a short position of Cardinal Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pintec Technology and Cardinal Health.
Diversification Opportunities for Pintec Technology and Cardinal Health
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pintec and Cardinal is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Pintec Technology Holdings and Cardinal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardinal Health and Pintec Technology 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 Pintec Technology Holdings are associated (or correlated) with Cardinal Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardinal Health has no effect on the direction of Pintec Technology i.e., Pintec Technology and Cardinal Health go up and down completely randomly.
Pair Corralation between Pintec Technology and Cardinal Health
Allowing for the 90-day total investment horizon Pintec Technology Holdings is expected to generate 3.16 times more return on investment than Cardinal Health. However, Pintec Technology is 3.16 times more volatile than Cardinal Health. It trades about 0.06 of its potential returns per unit of risk. Cardinal Health is currently generating about 0.08 per unit of risk. If you would invest 41.00 in Pintec Technology Holdings on September 24, 2024 and sell it today you would earn a total of 51.01 from holding Pintec Technology Holdings or generate 124.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Pintec Technology Holdings vs. Cardinal Health
Performance |
Timeline |
Pintec Technology |
Cardinal Health |
Pintec Technology and Cardinal Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pintec Technology and Cardinal Health
The main advantage of trading using opposite Pintec Technology and Cardinal Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pintec Technology position performs unexpectedly, Cardinal 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 Cardinal Health will offset losses from the drop in Cardinal Health's long position.Pintec Technology vs. Visa Class A | Pintec Technology vs. Mastercard | Pintec Technology vs. Discover Financial Services |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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