Correlation Between Cardinal Health and LOWES
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By analyzing existing cross correlation between Cardinal Health and LOWES INC 6875, you can compare the effects of market volatilities on Cardinal Health and LOWES 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 LOWES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Health and LOWES.
Diversification Opportunities for Cardinal Health and LOWES
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cardinal and LOWES is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Health and LOWES INC 6875 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOWES INC 6875 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 LOWES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOWES INC 6875 has no effect on the direction of Cardinal Health i.e., Cardinal Health and LOWES go up and down completely randomly.
Pair Corralation between Cardinal Health and LOWES
Considering the 90-day investment horizon Cardinal Health is expected to generate 2.3 times more return on investment than LOWES. However, Cardinal Health is 2.3 times more volatile than LOWES INC 6875. It trades about 0.1 of its potential returns per unit of risk. LOWES INC 6875 is currently generating about 0.01 per unit of risk. If you would invest 9,997 in Cardinal Health on September 13, 2024 and sell it today you would earn a total of 1,821 from holding Cardinal Health or generate 18.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 94.4% |
| Values | Daily Returns |
Cardinal Health vs. LOWES INC 6875
Performance |
| Timeline |
| Cardinal Health |
| LOWES INC 6875 |
Cardinal Health and LOWES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Health and LOWES
The main advantage of trading using opposite Cardinal Health and LOWES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Health position performs unexpectedly, LOWES 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 LOWES will offset losses from the drop in LOWES's long position.| Cardinal Health vs. Henry Schein | Cardinal Health vs. Owens Minor | Cardinal Health vs. Patterson Companies | Cardinal Health vs. McKesson |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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