Correlation Between Ramsay Health and ANTA SPORTS

Can any of the company-specific risk be diversified away by investing in both Ramsay Health and ANTA SPORTS 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 Ramsay Health and ANTA SPORTS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ramsay Health Care and ANTA SPORTS PRODUCT, you can compare the effects of market volatilities on Ramsay Health and ANTA SPORTS 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 Ramsay Health with a short position of ANTA SPORTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramsay Health and ANTA SPORTS.

Diversification Opportunities for Ramsay Health and ANTA SPORTS

0.51

Correlation Coefficient

Ramsay Health  ANTA SPORTS

Very weak diversification

The 3 months correlation between Ramsay and ANTA is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Ramsay Health Care and ANTA SPORTS PRODUCT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANTA SPORTS PRODUCT and Ramsay Health 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 Ramsay Health Care are associated (or correlated) with ANTA SPORTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANTA SPORTS PRODUCT has no effect on the direction of Ramsay Health i.e., Ramsay Health and ANTA SPORTS go up and down completely randomly.

Pair Corralation between Ramsay Health and ANTA SPORTS

Assuming the 90 days horizon Ramsay Health Care is expected to under-perform the ANTA SPORTS. But the stock apears to be less risky and, when comparing its historical volatility, Ramsay Health Care is 1.59 times less risky than ANTA SPORTS. The stock trades about -0.01 of its potential returns per unit of risk. The ANTA SPORTS PRODUCT is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  1,008  in ANTA SPORTS PRODUCT on September 13, 2024 and sell it today you would lose (6.00) from holding ANTA SPORTS PRODUCT or give up 0.6% of portfolio value over 90 days.

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

Ramsay Health Care  vs.  ANTA SPORTS PRODUCT

Ramsay Health Care

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ramsay Health Care has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ramsay Health is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ANTA SPORTS PRODUCT

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ANTA SPORTS PRODUCT are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, ANTA SPORTS exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ramsay Health and ANTA SPORTS

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

The idea behind Ramsay Health Care and ANTA SPORTS PRODUCT 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.