Correlation Between HCA Healthcare and BA69
Can any of the company-specific risk be diversified away by investing in both HCA Healthcare and BA69 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 BA69 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HCA Healthcare and BA69, you can compare the effects of market volatilities on HCA Healthcare and BA69 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 BA69. Check out your portfolio center. Please also check ongoing floating volatility patterns of HCA Healthcare and BA69.
Diversification Opportunities for HCA Healthcare and BA69
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between HCA and BA69 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding HCA Healthcare and BA69 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BA69 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 BA69. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BA69 has no effect on the direction of HCA Healthcare i.e., HCA Healthcare and BA69 go up and down completely randomly.
Pair Corralation between HCA Healthcare and BA69
Assuming the 90 days trading horizon HCA Healthcare is expected to generate 26.27 times more return on investment than BA69. However, HCA Healthcare is 26.27 times more volatile than BA69. It trades about 0.04 of its potential returns per unit of risk. BA69 is currently generating about 0.09 per unit of risk. If you would invest 23,280 in HCA Healthcare on August 24, 2024 and sell it today you would earn a total of 9,584 from holding HCA Healthcare or generate 41.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.8% |
| Values | Daily Returns |
HCA Healthcare vs. BA69
Performance |
| Timeline |
| HCA Healthcare |
| BA69 |
HCA Healthcare and BA69 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HCA Healthcare and BA69
The main advantage of trading using opposite HCA Healthcare and BA69 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HCA Healthcare position performs unexpectedly, BA69 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 BA69 will offset losses from the drop in BA69's long position.| HCA Healthcare vs. Quadrise Plc | HCA Healthcare vs. Intuitive Investments Group | HCA Healthcare vs. European Metals Holdings | HCA Healthcare vs. Athelney Trust plc |
| BA69 vs. Aeorema Communications Plc | BA69 vs. Eco Animal Health | BA69 vs. HCA Healthcare | BA69 vs. Zoom Video Communications |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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