Correlation Between COPLAND ROAD and Sabra Health
Can any of the company-specific risk be diversified away by investing in both COPLAND ROAD 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 COPLAND ROAD and Sabra Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COPLAND ROAD CAPITAL and Sabra Health Care, you can compare the effects of market volatilities on COPLAND ROAD 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 COPLAND ROAD with a short position of Sabra Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of COPLAND ROAD and Sabra Health.
Diversification Opportunities for COPLAND ROAD and Sabra Health
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between COPLAND and Sabra is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding COPLAND ROAD CAPITAL 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 COPLAND ROAD 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 COPLAND ROAD CAPITAL 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 COPLAND ROAD i.e., COPLAND ROAD and Sabra Health go up and down completely randomly.
Pair Corralation between COPLAND ROAD and Sabra Health
Assuming the 90 days horizon COPLAND ROAD CAPITAL is expected to under-perform the Sabra Health. In addition to that, COPLAND ROAD is 1.44 times more volatile than Sabra Health Care. It trades about -0.08 of its total potential returns per unit of risk. Sabra Health Care is currently generating about 0.14 per unit of volatility. If you would invest 1,629 in Sabra Health Care on September 3, 2024 and sell it today you would earn a total of 152.00 from holding Sabra Health Care or generate 9.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
COPLAND ROAD CAPITAL vs. Sabra Health Care
Performance |
| Timeline |
| COPLAND ROAD CAPITAL |
| Sabra Health Care |
COPLAND ROAD and Sabra Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COPLAND ROAD and Sabra Health
The main advantage of trading using opposite COPLAND ROAD and Sabra Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COPLAND ROAD 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.| COPLAND ROAD vs. Merck KGaA | COPLAND ROAD vs. CanSino Biologics | COPLAND ROAD vs. Superior Plus Corp | COPLAND ROAD vs. NMI Holdings |
| Sabra Health vs. THAI BEVERAGE | Sabra Health vs. Lifeway Foods | Sabra Health vs. Cal Maine Foods | Sabra Health vs. SENECA FOODS A |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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