Correlation Between Addus HomeCare and C3is
Can any of the company-specific risk be diversified away by investing in both Addus HomeCare and C3is 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 Addus HomeCare and C3is into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addus HomeCare and C3is Inc, you can compare the effects of market volatilities on Addus HomeCare and C3is 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 Addus HomeCare with a short position of C3is. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addus HomeCare and C3is.
Diversification Opportunities for Addus HomeCare and C3is
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Addus and C3is is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Addus HomeCare and C3is Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on C3is Inc and Addus HomeCare 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 Addus HomeCare are associated (or correlated) with C3is. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of C3is Inc has no effect on the direction of Addus HomeCare i.e., Addus HomeCare and C3is go up and down completely randomly.
Pair Corralation between Addus HomeCare and C3is
Given the investment horizon of 90 days Addus HomeCare is expected to generate 0.24 times more return on investment than C3is. However, Addus HomeCare is 4.18 times less risky than C3is. It trades about 0.03 of its potential returns per unit of risk. C3is Inc is currently generating about -0.15 per unit of risk. If you would invest 9,834 in Addus HomeCare on September 14, 2024 and sell it today you would earn a total of 2,390 from holding Addus HomeCare or generate 24.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 76.57% |
| Values | Daily Returns |
Addus HomeCare vs. C3is Inc
Performance |
| Timeline |
| Addus HomeCare |
| C3is Inc |
Addus HomeCare and C3is Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addus HomeCare and C3is
The main advantage of trading using opposite Addus HomeCare and C3is positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addus HomeCare position performs unexpectedly, C3is 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 C3is will offset losses from the drop in C3is' long position.| Addus HomeCare vs. Encompass Health Corp | Addus HomeCare vs. Pennant Group | Addus HomeCare vs. Acadia Healthcare | Addus HomeCare vs. Select Medical Holdings |
| C3is vs. United Homes Group | C3is vs. Ross Stores | C3is vs. Addus HomeCare | C3is vs. Mid Atlantic Home Health |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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