Correlation Between Apollo Medical and CAIRN HOMES
Can any of the company-specific risk be diversified away by investing in both Apollo Medical and CAIRN HOMES 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 Apollo Medical and CAIRN HOMES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apollo Medical Holdings and CAIRN HOMES EO, you can compare the effects of market volatilities on Apollo Medical and CAIRN HOMES 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 Apollo Medical with a short position of CAIRN HOMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Medical and CAIRN HOMES.
Diversification Opportunities for Apollo Medical and CAIRN HOMES
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Apollo and CAIRN is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Medical Holdings and CAIRN HOMES EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAIRN HOMES EO and Apollo Medical 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 Apollo Medical Holdings are associated (or correlated) with CAIRN HOMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAIRN HOMES EO has no effect on the direction of Apollo Medical i.e., Apollo Medical and CAIRN HOMES go up and down completely randomly.
Pair Corralation between Apollo Medical and CAIRN HOMES
Assuming the 90 days horizon Apollo Medical Holdings is expected to generate 1.31 times more return on investment than CAIRN HOMES. However, Apollo Medical is 1.31 times more volatile than CAIRN HOMES EO. It trades about 0.2 of its potential returns per unit of risk. CAIRN HOMES EO is currently generating about -0.06 per unit of risk. If you would invest 3,060 in Apollo Medical Holdings on November 7, 2024 and sell it today you would earn a total of 400.00 from holding Apollo Medical Holdings or generate 13.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Medical Holdings vs. CAIRN HOMES EO
Performance |
| Timeline |
| Apollo Medical Holdings |
| CAIRN HOMES EO |
Apollo Medical and CAIRN HOMES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Medical and CAIRN HOMES
The main advantage of trading using opposite Apollo Medical and CAIRN HOMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Medical position performs unexpectedly, CAIRN HOMES 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 CAIRN HOMES will offset losses from the drop in CAIRN HOMES's long position.| Apollo Medical vs. NIGHTINGALE HEALTH EO | Apollo Medical vs. Chesapeake Utilities | Apollo Medical vs. ON SEMICONDUCTOR | Apollo Medical vs. Elmos Semiconductor SE |
| CAIRN HOMES vs. GRIFFIN MINING LTD | CAIRN HOMES vs. CORNISH METALS INC | CAIRN HOMES vs. Transport International Holdings | CAIRN HOMES vs. Texas Roadhouse |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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