Correlation Between Intelligent Group and SBC Medical

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

By analyzing existing cross correlation between Intelligent Group Limited and SBC Medical Group, you can compare the effects of market volatilities on Intelligent Group and SBC 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 Intelligent Group with a short position of SBC Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intelligent Group and SBC Medical.

Diversification Opportunities for Intelligent Group and SBC Medical

-0.17

Correlation Coefficient

Intelligent Group  SBC Medical

Good diversification

The 3 months correlation between Intelligent and SBC is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Intelligent Group Limited and SBC Medical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBC Medical Group and Intelligent Group 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 Intelligent Group Limited are associated (or correlated) with SBC Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBC Medical Group has no effect on the direction of Intelligent Group i.e., Intelligent Group and SBC Medical go up and down completely randomly.

Pair Corralation between Intelligent Group and SBC Medical

Given the investment horizon of 90 days Intelligent Group is expected to generate 21.43 times less return on investment than SBC Medical. But when comparing it to its historical volatility, Intelligent Group Limited is 2.64 times less risky than SBC Medical. It trades about 0.03 of its potential returns per unit of risk. SBC Medical Group is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  7.31  in SBC Medical Group on September 13, 2024 and sell it today you would earn a total of  16.69  from holding SBC Medical Group or generate 228.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.31%
Values	Daily Returns

Intelligent Group Limited  vs.  SBC Medical Group

Intelligent Group

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Intelligent Group Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Intelligent Group may actually be approaching a critical reversion point that can send shares even higher in January 2025.

SBC Medical Group

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SBC Medical Group are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, SBC Medical showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intelligent Group and SBC Medical

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

The idea behind Intelligent Group Limited and SBC Medical Group 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.

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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.