Correlation Between Universal Health and Celebrus Technologies
Can any of the company-specific risk be diversified away by investing in both Universal Health and Celebrus Technologies 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 Universal Health and Celebrus Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Health Services and Celebrus Technologies plc, you can compare the effects of market volatilities on Universal Health and Celebrus Technologies 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 Universal Health with a short position of Celebrus Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Health and Celebrus Technologies.
Diversification Opportunities for Universal Health and Celebrus Technologies
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Universal and Celebrus is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Universal Health Services and Celebrus Technologies plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celebrus Technologies plc and Universal 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 Universal Health Services are associated (or correlated) with Celebrus Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celebrus Technologies plc has no effect on the direction of Universal Health i.e., Universal Health and Celebrus Technologies go up and down completely randomly.
Pair Corralation between Universal Health and Celebrus Technologies
Assuming the 90 days trading horizon Universal Health Services is expected to generate 1.2 times more return on investment than Celebrus Technologies. However, Universal Health is 1.2 times more volatile than Celebrus Technologies plc. It trades about -0.34 of its potential returns per unit of risk. Celebrus Technologies plc is currently generating about -0.48 per unit of risk. If you would invest 19,854 in Universal Health Services on September 24, 2024 and sell it today you would lose (1,837) from holding Universal Health Services or give up 9.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Universal Health Services vs. Celebrus Technologies plc
Performance |
| Timeline |
| Universal Health Services |
| Celebrus Technologies plc |
Universal Health and Celebrus Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Health and Celebrus Technologies
The main advantage of trading using opposite Universal Health and Celebrus Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Health position performs unexpectedly, Celebrus Technologies 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 Celebrus Technologies will offset losses from the drop in Celebrus Technologies' long position.| Universal Health vs. Uniper SE | Universal Health vs. Mulberry Group PLC | Universal Health vs. London Security Plc | Universal Health vs. Triad Group PLC |
| Celebrus Technologies vs. GB Group plc | Celebrus Technologies vs. Pensionbee Group PLC | Celebrus Technologies vs. Dotdigital Group Plc | Celebrus Technologies vs. Tracsis Plc |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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