Correlation Between Cardinal Health and Sonida Senior
Can any of the company-specific risk be diversified away by investing in both Cardinal Health and Sonida Senior 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 Sonida Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Health and Sonida Senior Living, you can compare the effects of market volatilities on Cardinal Health and Sonida Senior 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 Sonida Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Health and Sonida Senior.
Diversification Opportunities for Cardinal Health and Sonida Senior
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cardinal and Sonida is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Health and Sonida Senior Living in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonida Senior Living 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 Sonida Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonida Senior Living has no effect on the direction of Cardinal Health i.e., Cardinal Health and Sonida Senior go up and down completely randomly.
Pair Corralation between Cardinal Health and Sonida Senior
Considering the 90-day investment horizon Cardinal Health is expected to generate 0.49 times more return on investment than Sonida Senior. However, Cardinal Health is 2.02 times less risky than Sonida Senior. It trades about 0.14 of its potential returns per unit of risk. Sonida Senior Living is currently generating about -0.05 per unit of risk. If you would invest 10,894 in Cardinal Health on August 23, 2024 and sell it today you would earn a total of 1,448 from holding Cardinal Health or generate 13.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cardinal Health vs. Sonida Senior Living
Performance |
| Timeline |
| Cardinal Health |
| Sonida Senior Living |
Cardinal Health and Sonida Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Health and Sonida Senior
The main advantage of trading using opposite Cardinal Health and Sonida Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Health position performs unexpectedly, Sonida Senior 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 Sonida Senior will offset losses from the drop in Sonida Senior's long position.| Cardinal Health vs. Henry Schein | Cardinal Health vs. Owens Minor | Cardinal Health vs. Patterson Companies | Cardinal Health vs. McKesson |
| Sonida Senior vs. Select Medical Holdings | Sonida Senior vs. Encompass Health Corp | Sonida Senior vs. Pennant Group | Sonida Senior vs. InnovAge Holding Corp |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |