Correlation Between Arhaus and Concentra Group
Can any of the company-specific risk be diversified away by investing in both Arhaus and Concentra Group 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 Arhaus and Concentra Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arhaus Inc and Concentra Group Holdings, you can compare the effects of market volatilities on Arhaus and Concentra Group 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 Arhaus with a short position of Concentra Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arhaus and Concentra Group.
Diversification Opportunities for Arhaus and Concentra Group
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Arhaus and Concentra is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Arhaus Inc and Concentra Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concentra Group Holdings and Arhaus 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 Arhaus Inc are associated (or correlated) with Concentra Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concentra Group Holdings has no effect on the direction of Arhaus i.e., Arhaus and Concentra Group go up and down completely randomly.
Pair Corralation between Arhaus and Concentra Group
Given the investment horizon of 90 days Arhaus Inc is expected to generate 1.58 times more return on investment than Concentra Group. However, Arhaus is 1.58 times more volatile than Concentra Group Holdings. It trades about 0.17 of its potential returns per unit of risk. Concentra Group Holdings is currently generating about -0.03 per unit of risk. If you would invest 969.00 in Arhaus Inc on September 14, 2024 and sell it today you would earn a total of 113.00 from holding Arhaus Inc or generate 11.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arhaus Inc vs. Concentra Group Holdings
Performance |
| Timeline |
| Arhaus Inc |
| Concentra Group Holdings |
Arhaus and Concentra Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arhaus and Concentra Group
The main advantage of trading using opposite Arhaus and Concentra Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arhaus position performs unexpectedly, Concentra Group 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 Concentra Group will offset losses from the drop in Concentra Group's long position.| Arhaus vs. Floor Decor Holdings | Arhaus vs. Live Ventures | Arhaus vs. Home Depot | Arhaus vs. Lowes Companies |
| Concentra Group vs. Datadog | Concentra Group vs. Chester Mining | Concentra Group vs. Insteel Industries | Concentra Group vs. Tencent Music Entertainment |
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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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