Correlation Between Healthcare and ACM Research
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By analyzing existing cross correlation between Healthcare Co and ACM Research Shanghai, you can compare the effects of market volatilities on Healthcare and ACM Research 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 Healthcare with a short position of ACM Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare and ACM Research.
Diversification Opportunities for Healthcare and ACM Research
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Healthcare and ACM is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare Co and ACM Research Shanghai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ACM Research Shanghai and 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 Healthcare Co are associated (or correlated) with ACM Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ACM Research Shanghai has no effect on the direction of Healthcare i.e., Healthcare and ACM Research go up and down completely randomly.
Pair Corralation between Healthcare and ACM Research
Assuming the 90 days trading horizon Healthcare Co is expected to generate 1.31 times more return on investment than ACM Research. However, Healthcare is 1.31 times more volatile than ACM Research Shanghai. It trades about 0.23 of its potential returns per unit of risk. ACM Research Shanghai is currently generating about -0.12 per unit of risk. If you would invest 675.00 in Healthcare Co on September 23, 2024 and sell it today you would earn a total of 81.00 from holding Healthcare Co or generate 12.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Healthcare Co vs. ACM Research Shanghai
Performance |
Timeline |
Healthcare |
ACM Research Shanghai |
Healthcare and ACM Research Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Healthcare and ACM Research
The main advantage of trading using opposite Healthcare and ACM Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare position performs unexpectedly, ACM Research 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 ACM Research will offset losses from the drop in ACM Research's long position.Healthcare vs. Agricultural Bank of | Healthcare vs. Industrial and Commercial | Healthcare vs. Bank of China | Healthcare vs. China Construction Bank |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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