Correlation Between Concord Medical and Laboratory
Can any of the company-specific risk be diversified away by investing in both Concord Medical and Laboratory 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 Concord Medical and Laboratory into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concord Medical Services and Laboratory of, you can compare the effects of market volatilities on Concord Medical and Laboratory 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 Concord Medical with a short position of Laboratory. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Medical and Laboratory.
Diversification Opportunities for Concord Medical and Laboratory
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Concord and Laboratory is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Concord Medical Services and Laboratory of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laboratory and Concord Medical 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 Concord Medical Services are associated (or correlated) with Laboratory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laboratory has no effect on the direction of Concord Medical i.e., Concord Medical and Laboratory go up and down completely randomly.
Pair Corralation between Concord Medical and Laboratory
Considering the 90-day investment horizon Concord Medical Services is expected to generate 12.17 times more return on investment than Laboratory. However, Concord Medical is 12.17 times more volatile than Laboratory of. It trades about 0.17 of its potential returns per unit of risk. Laboratory of is currently generating about -0.12 per unit of risk. If you would invest 41.00 in Concord Medical Services on January 25, 2024 and sell it today you would earn a total of 16.01 from holding Concord Medical Services or generate 39.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Concord Medical Services vs. Laboratory of
Performance |
| Timeline |
| Concord Medical Services |
| Laboratory |
Concord Medical and Laboratory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Medical and Laboratory
The main advantage of trading using opposite Concord Medical and Laboratory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Medical position performs unexpectedly, Laboratory 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 Laboratory will offset losses from the drop in Laboratory's long position.| Concord Medical vs. Pennant Group | Concord Medical vs. Encompass Health Corp | Concord Medical vs. Enhabit | Concord Medical vs. National HealthCare |
| Laboratory vs. Aclaris Therapeutics | Laboratory vs. Prenetics Global | Laboratory vs. DarioHealth Corp | Laboratory vs. Olink Holding AB |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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