Correlation Between Concord Medical and ModivCare
Can any of the company-specific risk be diversified away by investing in both Concord Medical and ModivCare 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 ModivCare 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 ModivCare, you can compare the effects of market volatilities on Concord Medical and ModivCare 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 ModivCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concord Medical and ModivCare.
Diversification Opportunities for Concord Medical and ModivCare
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Concord and ModivCare is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Concord Medical Services and ModivCare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ModivCare 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 ModivCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ModivCare has no effect on the direction of Concord Medical i.e., Concord Medical and ModivCare go up and down completely randomly.
Pair Corralation between Concord Medical and ModivCare
Considering the 90-day investment horizon Concord Medical Services is expected to generate 0.91 times more return on investment than ModivCare. However, Concord Medical Services is 1.1 times less risky than ModivCare. It trades about 0.06 of its potential returns per unit of risk. ModivCare is currently generating about -0.32 per unit of risk. If you would invest 538.00 in Concord Medical Services on November 1, 2024 and sell it today you would earn a total of 10.00 from holding Concord Medical Services or generate 1.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Concord Medical Services vs. ModivCare
Performance |
| Timeline |
| Concord Medical Services |
| ModivCare |
Concord Medical and ModivCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concord Medical and ModivCare
The main advantage of trading using opposite Concord Medical and ModivCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concord Medical position performs unexpectedly, ModivCare 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 ModivCare will offset losses from the drop in ModivCare's long position.| Concord Medical vs. Pennant Group | Concord Medical vs. Encompass Health Corp | Concord Medical vs. Enhabit | Concord Medical vs. National HealthCare |
| ModivCare vs. The Ensign Group | ModivCare vs. Select Medical Holdings | ModivCare vs. Encompass Health Corp | ModivCare 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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