Correlation Between Acadia Healthcare and QBE Insurance
Can any of the company-specific risk be diversified away by investing in both Acadia Healthcare and QBE Insurance 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 Acadia Healthcare and QBE Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acadia Healthcare and QBE Insurance Group, you can compare the effects of market volatilities on Acadia Healthcare and QBE Insurance 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 Acadia Healthcare with a short position of QBE Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acadia Healthcare and QBE Insurance.
Diversification Opportunities for Acadia Healthcare and QBE Insurance
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Acadia and QBE is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Acadia Healthcare and QBE Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QBE Insurance Group and Acadia 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 Acadia Healthcare are associated (or correlated) with QBE Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QBE Insurance Group has no effect on the direction of Acadia Healthcare i.e., Acadia Healthcare and QBE Insurance go up and down completely randomly.
Pair Corralation between Acadia Healthcare and QBE Insurance
Assuming the 90 days horizon Acadia Healthcare is expected to generate 2.92 times more return on investment than QBE Insurance. However, Acadia Healthcare is 2.92 times more volatile than QBE Insurance Group. It trades about 0.34 of its potential returns per unit of risk. QBE Insurance Group is currently generating about 0.06 per unit of risk. If you would invest 3,760 in Acadia Healthcare on October 15, 2024 and sell it today you would earn a total of 600.00 from holding Acadia Healthcare or generate 15.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acadia Healthcare vs. QBE Insurance Group
Performance |
| Timeline |
| Acadia Healthcare |
| QBE Insurance Group |
Acadia Healthcare and QBE Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acadia Healthcare and QBE Insurance
The main advantage of trading using opposite Acadia Healthcare and QBE Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acadia Healthcare position performs unexpectedly, QBE Insurance 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 QBE Insurance will offset losses from the drop in QBE Insurance's long position.| Acadia Healthcare vs. Universal Health Services | Acadia Healthcare vs. Superior Plus Corp | Acadia Healthcare vs. NMI Holdings | Acadia Healthcare vs. SIVERS SEMICONDUCTORS AB |
| QBE Insurance vs. WESANA HEALTH HOLD | QBE Insurance vs. RCI Hospitality Holdings | QBE Insurance vs. Suntory Beverage Food | QBE Insurance vs. Acadia Healthcare |
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.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |