Correlation Between USWE SPORTS and SHIP HEALTHCARE
Can any of the company-specific risk be diversified away by investing in both USWE SPORTS and SHIP HEALTHCARE 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 USWE SPORTS and SHIP HEALTHCARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USWE SPORTS AB and SHIP HEALTHCARE HLDGINC, you can compare the effects of market volatilities on USWE SPORTS and SHIP HEALTHCARE 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 USWE SPORTS with a short position of SHIP HEALTHCARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of USWE SPORTS and SHIP HEALTHCARE.
Diversification Opportunities for USWE SPORTS and SHIP HEALTHCARE
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between USWE and SHIP is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding USWE SPORTS AB and SHIP HEALTHCARE HLDGINC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHIP HEALTHCARE HLDGINC and USWE SPORTS 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 USWE SPORTS AB are associated (or correlated) with SHIP HEALTHCARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHIP HEALTHCARE HLDGINC has no effect on the direction of USWE SPORTS i.e., USWE SPORTS and SHIP HEALTHCARE go up and down completely randomly.
Pair Corralation between USWE SPORTS and SHIP HEALTHCARE
Assuming the 90 days horizon USWE SPORTS AB is expected to under-perform the SHIP HEALTHCARE. In addition to that, USWE SPORTS is 1.48 times more volatile than SHIP HEALTHCARE HLDGINC. It trades about -0.03 of its total potential returns per unit of risk. SHIP HEALTHCARE HLDGINC is currently generating about 0.02 per unit of volatility. If you would invest 1,123 in SHIP HEALTHCARE HLDGINC on August 29, 2024 and sell it today you would earn a total of 207.00 from holding SHIP HEALTHCARE HLDGINC or generate 18.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
USWE SPORTS AB vs. SHIP HEALTHCARE HLDGINC
Performance |
| Timeline |
| USWE SPORTS AB |
| SHIP HEALTHCARE HLDGINC |
USWE SPORTS and SHIP HEALTHCARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USWE SPORTS and SHIP HEALTHCARE
The main advantage of trading using opposite USWE SPORTS and SHIP HEALTHCARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USWE SPORTS position performs unexpectedly, SHIP HEALTHCARE 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 SHIP HEALTHCARE will offset losses from the drop in SHIP HEALTHCARE's long position.| USWE SPORTS vs. NORDHEALTH AS NK | USWE SPORTS vs. Check Point Software | USWE SPORTS vs. Casio Computer CoLtd | USWE SPORTS vs. Amkor Technology |
| SHIP HEALTHCARE vs. Evolution Mining Limited | SHIP HEALTHCARE vs. Ubisoft Entertainment SA | SHIP HEALTHCARE vs. RCS MediaGroup SpA | SHIP HEALTHCARE vs. Beijing Media |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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