Correlation Between MEDICAL FACILITIES and American States
Can any of the company-specific risk be diversified away by investing in both MEDICAL FACILITIES and American States 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 MEDICAL FACILITIES and American States into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MEDICAL FACILITIES NEW and American States Water, you can compare the effects of market volatilities on MEDICAL FACILITIES and American States 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 MEDICAL FACILITIES with a short position of American States. Check out your portfolio center. Please also check ongoing floating volatility patterns of MEDICAL FACILITIES and American States.
Diversification Opportunities for MEDICAL FACILITIES and American States
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MEDICAL and American is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding MEDICAL FACILITIES NEW and American States Water in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American States Water and MEDICAL FACILITIES 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 MEDICAL FACILITIES NEW are associated (or correlated) with American States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American States Water has no effect on the direction of MEDICAL FACILITIES i.e., MEDICAL FACILITIES and American States go up and down completely randomly.
Pair Corralation between MEDICAL FACILITIES and American States
Assuming the 90 days horizon MEDICAL FACILITIES NEW is expected to generate 1.67 times more return on investment than American States. However, MEDICAL FACILITIES is 1.67 times more volatile than American States Water. It trades about 0.21 of its potential returns per unit of risk. American States Water is currently generating about 0.17 per unit of risk. If you would invest 960.00 in MEDICAL FACILITIES NEW on August 29, 2024 and sell it today you would earn a total of 110.00 from holding MEDICAL FACILITIES NEW or generate 11.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MEDICAL FACILITIES NEW vs. American States Water
Performance |
| Timeline |
| MEDICAL FACILITIES NEW |
| American States Water |
MEDICAL FACILITIES and American States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MEDICAL FACILITIES and American States
The main advantage of trading using opposite MEDICAL FACILITIES and American States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MEDICAL FACILITIES position performs unexpectedly, American States 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 American States will offset losses from the drop in American States' long position.| MEDICAL FACILITIES vs. AM EAGLE OUTFITTERS | MEDICAL FACILITIES vs. Genco Shipping Trading | MEDICAL FACILITIES vs. Liberty Broadband | MEDICAL FACILITIES vs. Gaztransport Technigaz SA |
| American States vs. TITAN MACHINERY | American States vs. DAIRY FARM INTL | American States vs. Chongqing Machinery Electric | American States vs. Titan Machinery |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |