Correlation Between Brookfield Finance and Addus HomeCare
Can any of the company-specific risk be diversified away by investing in both Brookfield Finance and Addus HomeCare 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 Brookfield Finance and Addus HomeCare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookfield Finance I and Addus HomeCare, you can compare the effects of market volatilities on Brookfield Finance and Addus HomeCare 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 Brookfield Finance with a short position of Addus HomeCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Finance and Addus HomeCare.
Diversification Opportunities for Brookfield Finance and Addus HomeCare
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Brookfield and Addus is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Finance I and Addus HomeCare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Addus HomeCare and Brookfield Finance 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 Brookfield Finance I are associated (or correlated) with Addus HomeCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Addus HomeCare has no effect on the direction of Brookfield Finance i.e., Brookfield Finance and Addus HomeCare go up and down completely randomly.
Pair Corralation between Brookfield Finance and Addus HomeCare
If you would invest 1,506 in Brookfield Finance I on September 4, 2024 and sell it today you would earn a total of 0.00 from holding Brookfield Finance I or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Brookfield Finance I vs. Addus HomeCare
Performance |
| Timeline |
| Brookfield Finance |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Addus HomeCare |
Brookfield Finance and Addus HomeCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brookfield Finance and Addus HomeCare
The main advantage of trading using opposite Brookfield Finance and Addus HomeCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookfield Finance position performs unexpectedly, Addus HomeCare 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 Addus HomeCare will offset losses from the drop in Addus HomeCare's long position.| Brookfield Finance vs. Air Products and | Brookfield Finance vs. Luxfer Holdings PLC | Brookfield Finance vs. NL Industries | Brookfield Finance vs. Braskem SA Class |
| Addus HomeCare vs. Encompass Health Corp | Addus HomeCare vs. Pennant Group | Addus HomeCare vs. Acadia Healthcare | Addus HomeCare vs. Select Medical Holdings |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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