Correlation Between PLAY2CHILL and Sabra Health
Can any of the company-specific risk be diversified away by investing in both PLAY2CHILL and Sabra Health 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 PLAY2CHILL and Sabra Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAY2CHILL SA ZY and Sabra Health Care, you can compare the effects of market volatilities on PLAY2CHILL and Sabra Health 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 PLAY2CHILL with a short position of Sabra Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAY2CHILL and Sabra Health.
Diversification Opportunities for PLAY2CHILL and Sabra Health
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between PLAY2CHILL and Sabra is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding PLAY2CHILL SA ZY and Sabra Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabra Health Care and PLAY2CHILL 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 PLAY2CHILL SA ZY are associated (or correlated) with Sabra Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabra Health Care has no effect on the direction of PLAY2CHILL i.e., PLAY2CHILL and Sabra Health go up and down completely randomly.
Pair Corralation between PLAY2CHILL and Sabra Health
Assuming the 90 days horizon PLAY2CHILL SA ZY is expected to generate 0.82 times more return on investment than Sabra Health. However, PLAY2CHILL SA ZY is 1.22 times less risky than Sabra Health. It trades about 0.05 of its potential returns per unit of risk. Sabra Health Care is currently generating about -0.01 per unit of risk. If you would invest 81.00 in PLAY2CHILL SA ZY on October 25, 2024 and sell it today you would earn a total of 1.00 from holding PLAY2CHILL SA ZY or generate 1.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLAY2CHILL SA ZY vs. Sabra Health Care
Performance |
| Timeline |
| PLAY2CHILL SA ZY |
| Sabra Health Care |
PLAY2CHILL and Sabra Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAY2CHILL and Sabra Health
The main advantage of trading using opposite PLAY2CHILL and Sabra Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAY2CHILL position performs unexpectedly, Sabra Health 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 Sabra Health will offset losses from the drop in Sabra Health's long position.| PLAY2CHILL vs. GungHo Online Entertainment | PLAY2CHILL vs. WESANA HEALTH HOLD | PLAY2CHILL vs. HEALTHSTREAM | PLAY2CHILL vs. CVS Health |
| Sabra Health vs. MagnaChip Semiconductor Corp | Sabra Health vs. SENECA FOODS A | Sabra Health vs. INDOFOOD AGRI RES | Sabra Health vs. Semiconductor Manufacturing International |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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