Correlation Between CareCloud and Heartbeam
Can any of the company-specific risk be diversified away by investing in both CareCloud and Heartbeam 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 CareCloud and Heartbeam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CareCloud and Heartbeam, you can compare the effects of market volatilities on CareCloud and Heartbeam 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 CareCloud with a short position of Heartbeam. Check out your portfolio center. Please also check ongoing floating volatility patterns of CareCloud and Heartbeam.
Diversification Opportunities for CareCloud and Heartbeam
Very weak diversification
The 3 months correlation between CareCloud and Heartbeam is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding CareCloud and Heartbeam in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heartbeam and CareCloud 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 CareCloud are associated (or correlated) with Heartbeam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heartbeam has no effect on the direction of CareCloud i.e., CareCloud and Heartbeam go up and down completely randomly.
Pair Corralation between CareCloud and Heartbeam
Assuming the 90 days horizon CareCloud is expected to generate 1.16 times less return on investment than Heartbeam. In addition to that, CareCloud is 1.13 times more volatile than Heartbeam. It trades about 0.03 of its total potential returns per unit of risk. Heartbeam is currently generating about 0.03 per unit of volatility. If you would invest 263.00 in Heartbeam on August 31, 2024 and sell it today you would earn a total of 43.00 from holding Heartbeam or generate 16.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CareCloud vs. Heartbeam
Performance |
| Timeline |
| CareCloud |
| Heartbeam |
CareCloud and Heartbeam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CareCloud and Heartbeam
The main advantage of trading using opposite CareCloud and Heartbeam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CareCloud position performs unexpectedly, Heartbeam 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 Heartbeam will offset losses from the drop in Heartbeam's long position.| CareCloud vs. Evolent Health | CareCloud vs. Simulations Plus | CareCloud vs. Privia Health Group | CareCloud vs. HealthStream |
| Heartbeam vs. Teladoc | Heartbeam vs. Veeva Systems Class | Heartbeam vs. 10X Genomics | Heartbeam vs. Progyny |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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