Correlation Between Applied Materials, and Healthpeak Properties
Can any of the company-specific risk be diversified away by investing in both Applied Materials, and Healthpeak Properties 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 Applied Materials, and Healthpeak Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied Materials, and Healthpeak Properties, you can compare the effects of market volatilities on Applied Materials, and Healthpeak Properties 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 Applied Materials, with a short position of Healthpeak Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Materials, and Healthpeak Properties.
Diversification Opportunities for Applied Materials, and Healthpeak Properties
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Applied and Healthpeak is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Applied Materials, and Healthpeak Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthpeak Properties and Applied Materials, 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 Applied Materials, are associated (or correlated) with Healthpeak Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthpeak Properties has no effect on the direction of Applied Materials, i.e., Applied Materials, and Healthpeak Properties go up and down completely randomly.
Pair Corralation between Applied Materials, and Healthpeak Properties
Assuming the 90 days trading horizon Applied Materials, is expected to generate 1.56 times more return on investment than Healthpeak Properties. However, Applied Materials, is 1.56 times more volatile than Healthpeak Properties. It trades about 0.08 of its potential returns per unit of risk. Healthpeak Properties is currently generating about -0.07 per unit of risk. If you would invest 10,398 in Applied Materials, on November 4, 2024 and sell it today you would earn a total of 517.00 from holding Applied Materials, or generate 4.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Applied Materials, vs. Healthpeak Properties
Performance |
| Timeline |
| Applied Materials, |
| Healthpeak Properties |
Applied Materials, and Healthpeak Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Materials, and Healthpeak Properties
The main advantage of trading using opposite Applied Materials, and Healthpeak Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Materials, position performs unexpectedly, Healthpeak Properties 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 Healthpeak Properties will offset losses from the drop in Healthpeak Properties' long position.| Applied Materials, vs. JB Hunt Transport | Applied Materials, vs. Spotify Technology SA | Applied Materials, vs. Trane Technologies plc | Applied Materials, vs. Cognizant Technology Solutions |
| Healthpeak Properties vs. Bread Financial Holdings | Healthpeak Properties vs. Credit Acceptance | Healthpeak Properties vs. Citizens Financial Group, | Healthpeak Properties vs. American Airlines Group |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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