Correlation Between HCA Healthcare and Andrews Sykes
Can any of the company-specific risk be diversified away by investing in both HCA Healthcare and Andrews Sykes 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 HCA Healthcare and Andrews Sykes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HCA Healthcare and Andrews Sykes Group, you can compare the effects of market volatilities on HCA Healthcare and Andrews Sykes 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 HCA Healthcare with a short position of Andrews Sykes. Check out your portfolio center. Please also check ongoing floating volatility patterns of HCA Healthcare and Andrews Sykes.
Diversification Opportunities for HCA Healthcare and Andrews Sykes
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HCA and Andrews is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding HCA Healthcare and Andrews Sykes Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Andrews Sykes Group and HCA Healthcare 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 HCA Healthcare are associated (or correlated) with Andrews Sykes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Andrews Sykes Group has no effect on the direction of HCA Healthcare i.e., HCA Healthcare and Andrews Sykes go up and down completely randomly.
Pair Corralation between HCA Healthcare and Andrews Sykes
Assuming the 90 days trading horizon HCA Healthcare is expected to under-perform the Andrews Sykes. In addition to that, HCA Healthcare is 1.21 times more volatile than Andrews Sykes Group. It trades about -0.43 of its total potential returns per unit of risk. Andrews Sykes Group is currently generating about -0.17 per unit of volatility. If you would invest 52,000 in Andrews Sykes Group on September 15, 2024 and sell it today you would lose (1,850) from holding Andrews Sykes Group or give up 3.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HCA Healthcare vs. Andrews Sykes Group
Performance |
| Timeline |
| HCA Healthcare |
| Andrews Sykes Group |
HCA Healthcare and Andrews Sykes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HCA Healthcare and Andrews Sykes
The main advantage of trading using opposite HCA Healthcare and Andrews Sykes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HCA Healthcare position performs unexpectedly, Andrews Sykes 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 Andrews Sykes will offset losses from the drop in Andrews Sykes' long position.| HCA Healthcare vs. Kinnevik Investment AB | HCA Healthcare vs. Hansa Investment | HCA Healthcare vs. Bankers Investment Trust | HCA Healthcare vs. BE Semiconductor Industries |
| Andrews Sykes vs. Omega Healthcare Investors | Andrews Sykes vs. Optima Health plc | Andrews Sykes vs. HCA Healthcare | Andrews Sykes vs. Universal Display Corp |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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