Correlation Between YHN Acquisition and Aimei Health

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

By analyzing existing cross correlation between YHN Acquisition I and Aimei Health Technology, you can compare the effects of market volatilities on YHN Acquisition and Aimei 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 YHN Acquisition with a short position of Aimei Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of YHN Acquisition and Aimei Health.

Diversification Opportunities for YHN Acquisition and Aimei Health

-0.24

Correlation Coefficient

YHN Acquisition  Aimei Health

Very good diversification

The 3 months correlation between YHN and Aimei is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding YHN Acquisition I and Aimei Health Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aimei Health Technology and YHN Acquisition 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 YHN Acquisition I are associated (or correlated) with Aimei Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aimei Health Technology has no effect on the direction of YHN Acquisition i.e., YHN Acquisition and Aimei Health go up and down completely randomly.

Pair Corralation between YHN Acquisition and Aimei Health

Assuming the 90 days horizon YHN Acquisition I is expected to generate 0.32 times more return on investment than Aimei Health. However, YHN Acquisition I is 3.16 times less risky than Aimei Health. It trades about 0.23 of its potential returns per unit of risk. Aimei Health Technology is currently generating about 0.06 per unit of risk. If you would invest  1,000.00  in YHN Acquisition I on September 12, 2024 and sell it today you would earn a total of  50.00  from holding YHN Acquisition I or generate 5.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

YHN Acquisition I  vs.  Aimei Health Technology

YHN Acquisition I

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in YHN Acquisition I are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, YHN Acquisition is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Aimei Health Technology

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Aimei Health Technology are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable forward-looking signals, Aimei Health is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with YHN Acquisition and Aimei Health

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

The idea behind YHN Acquisition I and Aimei Health Technology 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.