Correlation Between Concord Medical and InnovAge Holding
Can any of the company-specific risk be diversified away by investing in both Concord Medical and InnovAge Holding 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 Concord Medical and InnovAge Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concord Medical Services and InnovAge Holding Corp, you can compare the effects of market volatilities on Concord Medical and InnovAge Holding 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 Concord Medical with a short position of InnovAge Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Medical and InnovAge Holding.
Diversification Opportunities for Concord Medical and InnovAge Holding
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Concord and InnovAge is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Concord Medical Services and InnovAge Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InnovAge Holding Corp and Concord Medical 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 Concord Medical Services are associated (or correlated) with InnovAge Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InnovAge Holding Corp has no effect on the direction of Concord Medical i.e., Concord Medical and InnovAge Holding go up and down completely randomly.
Pair Corralation between Concord Medical and InnovAge Holding
Considering the 90-day investment horizon Concord Medical Services is expected to under-perform the InnovAge Holding. In addition to that, Concord Medical is 2.52 times more volatile than InnovAge Holding Corp. It trades about -0.21 of its total potential returns per unit of risk. InnovAge Holding Corp is currently generating about -0.33 per unit of volatility. If you would invest 585.00 in InnovAge Holding Corp on August 28, 2024 and sell it today you would lose (110.00) from holding InnovAge Holding Corp or give up 18.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Concord Medical Services vs. InnovAge Holding Corp
Performance |
| Timeline |
| Concord Medical Services |
| InnovAge Holding Corp |
Concord Medical and InnovAge Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Medical and InnovAge Holding
The main advantage of trading using opposite Concord Medical and InnovAge Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Medical position performs unexpectedly, InnovAge Holding 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 InnovAge Holding will offset losses from the drop in InnovAge Holding's long position.| Concord Medical vs. Pennant Group | Concord Medical vs. Encompass Health Corp | Concord Medical vs. Enhabit | Concord Medical vs. National HealthCare |
| InnovAge Holding vs. The Ensign Group | InnovAge Holding vs. Select Medical Holdings | InnovAge Holding vs. Encompass Health Corp | InnovAge Holding vs. Enhabit |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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