Correlation Between Beacon Redevelopment and National Health
Can any of the company-specific risk be diversified away by investing in both Beacon Redevelopment and National Health 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 Beacon Redevelopment and National Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beacon Redevelopment and National Health Scan, you can compare the effects of market volatilities on Beacon Redevelopment and National Health 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 Beacon Redevelopment with a short position of National Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beacon Redevelopment and National Health.
Diversification Opportunities for Beacon Redevelopment and National Health
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Beacon and National is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Beacon Redevelopment and National Health Scan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Health Scan and Beacon Redevelopment 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 Beacon Redevelopment are associated (or correlated) with National Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Health Scan has no effect on the direction of Beacon Redevelopment i.e., Beacon Redevelopment and National Health go up and down completely randomly.
Pair Corralation between Beacon Redevelopment and National Health
If you would invest 2.00 in National Health Scan on September 13, 2024 and sell it today you would lose (0.40) from holding National Health Scan or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 7.14% |
| Values | Daily Returns |
Beacon Redevelopment vs. National Health Scan
Performance |
| Timeline |
| Beacon Redevelopment |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| National Health Scan |
Beacon Redevelopment and National Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beacon Redevelopment and National Health
The main advantage of trading using opposite Beacon Redevelopment and National Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beacon Redevelopment position performs unexpectedly, National Health 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 National Health will offset losses from the drop in National Health's long position.| Beacon Redevelopment vs. National Health Scan | Beacon Redevelopment vs. RCABS Inc | Beacon Redevelopment vs. Umbra Applied Technologies | Beacon Redevelopment vs. Hitachi Ltd ADR |
| National Health vs. Arca Continental SAB | National Health vs. Becle SA de | National Health vs. Aquagold International | National Health vs. Morningstar Unconstrained Allocation |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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