Correlation Between Airsculpt Technologies and Acadia Healthcare
Can any of the company-specific risk be diversified away by investing in both Airsculpt Technologies and Acadia Healthcare 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 Airsculpt Technologies and Acadia Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airsculpt Technologies and Acadia Healthcare, you can compare the effects of market volatilities on Airsculpt Technologies and Acadia Healthcare 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 Airsculpt Technologies with a short position of Acadia Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airsculpt Technologies and Acadia Healthcare.
Diversification Opportunities for Airsculpt Technologies and Acadia Healthcare
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Airsculpt and Acadia is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Airsculpt Technologies and Acadia Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadia Healthcare and Airsculpt Technologies 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 Airsculpt Technologies are associated (or correlated) with Acadia Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadia Healthcare has no effect on the direction of Airsculpt Technologies i.e., Airsculpt Technologies and Acadia Healthcare go up and down completely randomly.
Pair Corralation between Airsculpt Technologies and Acadia Healthcare
Given the investment horizon of 90 days Airsculpt Technologies is expected to under-perform the Acadia Healthcare. In addition to that, Airsculpt Technologies is 2.23 times more volatile than Acadia Healthcare. It trades about -0.05 of its total potential returns per unit of risk. Acadia Healthcare is currently generating about 0.18 per unit of volatility. If you would invest 3,709 in Acadia Healthcare on October 20, 2024 and sell it today you would earn a total of 669.00 from holding Acadia Healthcare or generate 18.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Airsculpt Technologies vs. Acadia Healthcare
Performance |
| Timeline |
| Airsculpt Technologies |
| Acadia Healthcare |
Airsculpt Technologies and Acadia Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Airsculpt Technologies and Acadia Healthcare
The main advantage of trading using opposite Airsculpt Technologies and Acadia Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airsculpt Technologies position performs unexpectedly, Acadia Healthcare 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 Acadia Healthcare will offset losses from the drop in Acadia Healthcare's long position.| Airsculpt Technologies vs. Acadia Healthcare | Airsculpt Technologies vs. Pennant Group | Airsculpt Technologies vs. Amedisys | Airsculpt Technologies vs. The Ensign Group |
| Acadia Healthcare vs. Encompass Health Corp | Acadia Healthcare vs. Pennant Group | Acadia Healthcare vs. Select Medical Holdings | Acadia Healthcare vs. Addus HomeCare |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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