Correlation Between SQUIRREL MEDIA and Acadia Healthcare
Can any of the company-specific risk be diversified away by investing in both SQUIRREL MEDIA and Acadia Healthcare 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 SQUIRREL MEDIA and Acadia Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SQUIRREL MEDIA SA and Acadia Healthcare, you can compare the effects of market volatilities on SQUIRREL MEDIA and Acadia Healthcare 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 SQUIRREL MEDIA with a short position of Acadia Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of SQUIRREL MEDIA and Acadia Healthcare.
Diversification Opportunities for SQUIRREL MEDIA and Acadia Healthcare
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SQUIRREL and Acadia is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding SQUIRREL MEDIA SA and Acadia Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadia Healthcare and SQUIRREL MEDIA 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 SQUIRREL MEDIA SA are associated (or correlated) with Acadia Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadia Healthcare has no effect on the direction of SQUIRREL MEDIA i.e., SQUIRREL MEDIA and Acadia Healthcare go up and down completely randomly.
Pair Corralation between SQUIRREL MEDIA and Acadia Healthcare
Assuming the 90 days horizon SQUIRREL MEDIA SA is expected to under-perform the Acadia Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, SQUIRREL MEDIA SA is 1.04 times less risky than Acadia Healthcare. The stock trades about -0.04 of its potential returns per unit of risk. The Acadia Healthcare is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 7,450 in Acadia Healthcare on October 28, 2024 and sell it today you would lose (3,210) from holding Acadia Healthcare or give up 43.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SQUIRREL MEDIA SA vs. Acadia Healthcare
Performance |
| Timeline |
| SQUIRREL MEDIA SA |
| Acadia Healthcare |
SQUIRREL MEDIA and Acadia Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SQUIRREL MEDIA and Acadia Healthcare
The main advantage of trading using opposite SQUIRREL MEDIA and Acadia Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SQUIRREL MEDIA position performs unexpectedly, Acadia Healthcare 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 Acadia Healthcare will offset losses from the drop in Acadia Healthcare's long position.| SQUIRREL MEDIA vs. Alaska Air Group | SQUIRREL MEDIA vs. BORR DRILLING NEW | SQUIRREL MEDIA vs. Tower One Wireless | SQUIRREL MEDIA vs. RYANAIR HLDGS ADR |
| Acadia Healthcare vs. RYANAIR HLDGS ADR | Acadia Healthcare vs. Pentair plc | Acadia Healthcare vs. FORWARD AIR P | Acadia Healthcare vs. NORWEGIAN AIR SHUT |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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