Correlation Between Addus HomeCare and Triumph
Can any of the company-specific risk be diversified away by investing in both Addus HomeCare and Triumph 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 Triumph into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Addus HomeCare and Triumph Group, you can compare the effects of market volatilities on Addus HomeCare and Triumph 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 Triumph. Check out your portfolio center. Please also check ongoing floating volatility patterns of Addus HomeCare and Triumph.
Diversification Opportunities for Addus HomeCare and Triumph
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Addus and Triumph is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Addus HomeCare and Triumph Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triumph Group 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 Triumph. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triumph Group has no effect on the direction of Addus HomeCare i.e., Addus HomeCare and Triumph go up and down completely randomly.
Pair Corralation between Addus HomeCare and Triumph
If you would invest 2.50 in Triumph Group on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Triumph Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Addus HomeCare vs. Triumph Group
Performance |
| Timeline |
| Addus HomeCare |
| Triumph Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Addus HomeCare and Triumph Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Addus HomeCare and Triumph
The main advantage of trading using opposite Addus HomeCare and Triumph positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Addus HomeCare position performs unexpectedly, Triumph 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 Triumph will offset losses from the drop in Triumph's long position.| Addus HomeCare vs. Encompass Health Corp | Addus HomeCare vs. Pennant Group | Addus HomeCare vs. Acadia Healthcare | Addus HomeCare vs. Select Medical Holdings |
| Triumph vs. Addus HomeCare | Triumph vs. SunLink Health Systems | Triumph vs. Sonida Senior Living | Triumph vs. Boston Properties |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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