Correlation Between FEMALE HEALTH and Xinhua Winshare

Can any of the company-specific risk be diversified away by investing in both FEMALE HEALTH and Xinhua Winshare 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 FEMALE HEALTH and Xinhua Winshare into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FEMALE HEALTH and Xinhua Winshare Publishing, you can compare the effects of market volatilities on FEMALE HEALTH and Xinhua Winshare 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 FEMALE HEALTH with a short position of Xinhua Winshare. Check out your portfolio center. Please also check ongoing floating volatility patterns of FEMALE HEALTH and Xinhua Winshare.

Diversification Opportunities for FEMALE HEALTH and Xinhua Winshare

0.57

Correlation Coefficient

FEMALE HEALTH  Xinhua Winshare

Very weak diversification

The 3 months correlation between FEMALE and Xinhua is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding FEMALE HEALTH and Xinhua Winshare Publishing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinhua Winshare Publ and FEMALE 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 FEMALE HEALTH are associated (or correlated) with Xinhua Winshare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinhua Winshare Publ has no effect on the direction of FEMALE HEALTH i.e., FEMALE HEALTH and Xinhua Winshare go up and down completely randomly.

Pair Corralation between FEMALE HEALTH and Xinhua Winshare

Assuming the 90 days trading horizon FEMALE HEALTH is expected to generate 2.84 times more return on investment than Xinhua Winshare. However, FEMALE HEALTH is 2.84 times more volatile than Xinhua Winshare Publishing. It trades about 0.02 of its potential returns per unit of risk. Xinhua Winshare Publishing is currently generating about 0.05 per unit of risk. If you would invest  48.00  in FEMALE HEALTH on April 25, 2025 and sell it today you would earn a total of  0.00  from holding FEMALE HEALTH or generate 0.0% return on investment over 90 days.

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

FEMALE HEALTH  vs.  Xinhua Winshare Publishing

FEMALE HEALTH

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FEMALE HEALTH are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, FEMALE HEALTH is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Xinhua Winshare Publ

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Xinhua Winshare Publishing are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Xinhua Winshare is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with FEMALE HEALTH and Xinhua Winshare

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

The idea behind FEMALE HEALTH and Xinhua Winshare Publishing 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.