Correlation Between Cardinal Health and Fluent
Can any of the company-specific risk be diversified away by investing in both Cardinal Health and Fluent 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 Cardinal Health and Fluent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Health and Fluent Inc, you can compare the effects of market volatilities on Cardinal Health and Fluent 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 Cardinal Health with a short position of Fluent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Health and Fluent.
Diversification Opportunities for Cardinal Health and Fluent
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cardinal and Fluent is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Health and Fluent Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fluent Inc and Cardinal Health 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 Cardinal Health are associated (or correlated) with Fluent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fluent Inc has no effect on the direction of Cardinal Health i.e., Cardinal Health and Fluent go up and down completely randomly.
Pair Corralation between Cardinal Health and Fluent
Considering the 90-day investment horizon Cardinal Health is expected to generate 1.32 times less return on investment than Fluent. But when comparing it to its historical volatility, Cardinal Health is 3.61 times less risky than Fluent. It trades about 0.05 of its potential returns per unit of risk. Fluent Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 306.00 in Fluent Inc on August 27, 2024 and sell it today you would lose (25.00) from holding Fluent Inc or give up 8.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cardinal Health vs. Fluent Inc
Performance |
| Timeline |
| Cardinal Health |
| Fluent Inc |
Cardinal Health and Fluent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Health and Fluent
The main advantage of trading using opposite Cardinal Health and Fluent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Health position performs unexpectedly, Fluent 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 Fluent will offset losses from the drop in Fluent's long position.The idea behind Cardinal Health and Fluent Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Fluent vs. Mirriad Advertising plc | Fluent vs. INEO Tech Corp | Fluent vs. Innovid Corp | Fluent vs. Townsquare Media |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |