Correlation Between Viemed Healthcare and Pingtan Marine

Can any of the company-specific risk be diversified away by investing in both Viemed Healthcare and Pingtan Marine 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 Viemed Healthcare and Pingtan Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Viemed Healthcare and Pingtan Marine Enterprise, you can compare the effects of market volatilities on Viemed Healthcare and Pingtan Marine 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 Viemed Healthcare with a short position of Pingtan Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viemed Healthcare and Pingtan Marine.

Diversification Opportunities for Viemed Healthcare and Pingtan Marine

-0.29

Correlation Coefficient

Viemed Healthcare  Pingtan Marine

Very good diversification

The 3 months correlation between Viemed and Pingtan is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Viemed Healthcare and Pingtan Marine Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pingtan Marine Enterprise and Viemed Healthcare 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 Viemed Healthcare are associated (or correlated) with Pingtan Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pingtan Marine Enterprise has no effect on the direction of Viemed Healthcare i.e., Viemed Healthcare and Pingtan Marine go up and down completely randomly.

Pair Corralation between Viemed Healthcare and Pingtan Marine

Considering the 90-day investment horizon Viemed Healthcare is expected to generate 0.95 times more return on investment than Pingtan Marine. However, Viemed Healthcare is 1.05 times less risky than Pingtan Marine. It trades about 0.01 of its potential returns per unit of risk. Pingtan Marine Enterprise is currently generating about -0.26 per unit of risk. If you would invest  828.00  in Viemed Healthcare on October 25, 2024 and sell it today you would lose (15.00) from holding Viemed Healthcare or give up 1.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.27%
Values	Daily Returns

Viemed Healthcare  vs.  Pingtan Marine Enterprise

Viemed Healthcare

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Viemed Healthcare has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's primary indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pingtan Marine Enterprise

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pingtan Marine Enterprise has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Pingtan Marine is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Viemed Healthcare and Pingtan Marine

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

The idea behind Viemed Healthcare and Pingtan Marine Enterprise 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.