Correlation Between American Healthcare and Creative Media
Can any of the company-specific risk be diversified away by investing in both American Healthcare and Creative Media 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 American Healthcare and Creative Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Healthcare REIT, and Creative Media Community, you can compare the effects of market volatilities on American Healthcare and Creative Media 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 American Healthcare with a short position of Creative Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Healthcare and Creative Media.
Diversification Opportunities for American Healthcare and Creative Media
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Creative is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding American Healthcare REIT, and Creative Media Community in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Creative Media Community and American Healthcare 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 American Healthcare REIT, are associated (or correlated) with Creative Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Creative Media Community has no effect on the direction of American Healthcare i.e., American Healthcare and Creative Media go up and down completely randomly.
Pair Corralation between American Healthcare and Creative Media
Considering the 90-day investment horizon American Healthcare REIT, is expected to generate 0.29 times more return on investment than Creative Media. However, American Healthcare REIT, is 3.45 times less risky than Creative Media. It trades about 0.25 of its potential returns per unit of risk. Creative Media Community is currently generating about -0.15 per unit of risk. If you would invest 1,265 in American Healthcare REIT, on August 26, 2024 and sell it today you would earn a total of 1,593 from holding American Healthcare REIT, or generate 125.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 81.53% |
| Values | Daily Returns |
American Healthcare REIT, vs. Creative Media Community
Performance |
| Timeline |
| American Healthcare REIT, |
| Creative Media Community |
American Healthcare and Creative Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Healthcare and Creative Media
The main advantage of trading using opposite American Healthcare and Creative Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Healthcare position performs unexpectedly, Creative Media 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 Creative Media will offset losses from the drop in Creative Media's long position.| American Healthcare vs. Boston Properties | American Healthcare vs. Alexandria Real Estate | American Healthcare vs. Highwoods Properties | American Healthcare vs. Hudson Pacific Properties |
| Creative Media vs. Cousins Properties Incorporated | Creative Media vs. Highwoods Properties | Creative Media vs. Douglas Emmett | Creative Media vs. Equity Commonwealth |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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