Correlation Between SHIP HEALTHCARE and CARSALES
Can any of the company-specific risk be diversified away by investing in both SHIP HEALTHCARE and CARSALES 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 SHIP HEALTHCARE and CARSALES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SHIP HEALTHCARE HLDGINC and CARSALESCOM, you can compare the effects of market volatilities on SHIP HEALTHCARE and CARSALES 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 SHIP HEALTHCARE with a short position of CARSALES. Check out your portfolio center. Please also check ongoing floating volatility patterns of SHIP HEALTHCARE and CARSALES.
Diversification Opportunities for SHIP HEALTHCARE and CARSALES
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SHIP and CARSALES is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding SHIP HEALTHCARE HLDGINC and CARSALESCOM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARSALESCOM and SHIP 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 SHIP HEALTHCARE HLDGINC are associated (or correlated) with CARSALES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARSALESCOM has no effect on the direction of SHIP HEALTHCARE i.e., SHIP HEALTHCARE and CARSALES go up and down completely randomly.
Pair Corralation between SHIP HEALTHCARE and CARSALES
Assuming the 90 days horizon SHIP HEALTHCARE HLDGINC is expected to under-perform the CARSALES. But the stock apears to be less risky and, when comparing its historical volatility, SHIP HEALTHCARE HLDGINC is 1.35 times less risky than CARSALES. The stock trades about -0.05 of its potential returns per unit of risk. The CARSALESCOM is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 2,200 in CARSALESCOM on November 4, 2024 and sell it today you would earn a total of 240.00 from holding CARSALESCOM or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SHIP HEALTHCARE HLDGINC vs. CARSALESCOM
Performance |
| Timeline |
| SHIP HEALTHCARE HLDGINC |
| CARSALESCOM |
SHIP HEALTHCARE and CARSALES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SHIP HEALTHCARE and CARSALES
The main advantage of trading using opposite SHIP HEALTHCARE and CARSALES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SHIP HEALTHCARE position performs unexpectedly, CARSALES 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 CARSALES will offset losses from the drop in CARSALES's long position.| SHIP HEALTHCARE vs. SLR Investment Corp | SHIP HEALTHCARE vs. SCIENCE IN SPORT | SHIP HEALTHCARE vs. SPORTING | SHIP HEALTHCARE vs. Transport International Holdings |
| CARSALES vs. INSURANCE AUST GRP | CARSALES vs. Singapore Reinsurance | CARSALES vs. REVO INSURANCE SPA | CARSALES vs. Applied Materials |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |