Correlation Between CeoTronics and Sabra Health
Can any of the company-specific risk be diversified away by investing in both CeoTronics and Sabra Health 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 CeoTronics and Sabra Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CeoTronics AG and Sabra Health Care, you can compare the effects of market volatilities on CeoTronics and Sabra Health 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 CeoTronics with a short position of Sabra Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of CeoTronics and Sabra Health.
Diversification Opportunities for CeoTronics and Sabra Health
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between CeoTronics and Sabra is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding CeoTronics AG and Sabra Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabra Health Care and CeoTronics 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 CeoTronics AG are associated (or correlated) with Sabra Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabra Health Care has no effect on the direction of CeoTronics i.e., CeoTronics and Sabra Health go up and down completely randomly.
Pair Corralation between CeoTronics and Sabra Health
Assuming the 90 days trading horizon CeoTronics AG is expected to generate 2.02 times more return on investment than Sabra Health. However, CeoTronics is 2.02 times more volatile than Sabra Health Care. It trades about 0.09 of its potential returns per unit of risk. Sabra Health Care is currently generating about 0.08 per unit of risk. If you would invest 400.00 in CeoTronics AG on January 19, 2025 and sell it today you would earn a total of 885.00 from holding CeoTronics AG or generate 221.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.26% |
| Values | Daily Returns |
CeoTronics AG vs. Sabra Health Care
Performance |
| Timeline |
| CeoTronics AG |
| Sabra Health Care |
CeoTronics and Sabra Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CeoTronics and Sabra Health
The main advantage of trading using opposite CeoTronics and Sabra Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CeoTronics position performs unexpectedly, Sabra Health 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 Sabra Health will offset losses from the drop in Sabra Health's long position.| CeoTronics vs. Cisco Systems | CeoTronics vs. Nokia | CeoTronics vs. ZTE Corporation | CeoTronics vs. Telefonaktiebolaget LM Ericsson |
| Sabra Health vs. Peijia Medical Limited | Sabra Health vs. CompuGroup Medical SE | Sabra Health vs. SWISS WATER DECAFFCOFFEE | Sabra Health vs. SPECTRAL MEDICAL |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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