Correlation Between Certara and Health Catalyst
Can any of the company-specific risk be diversified away by investing in both Certara and Health Catalyst 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 Certara and Health Catalyst into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Certara and Health Catalyst, you can compare the effects of market volatilities on Certara and Health Catalyst 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 Certara with a short position of Health Catalyst. Check out your portfolio center. Please also check ongoing floating volatility patterns of Certara and Health Catalyst.
Diversification Opportunities for Certara and Health Catalyst
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Certara and Health is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Certara and Health Catalyst in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Health Catalyst and Certara 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 Certara are associated (or correlated) with Health Catalyst. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Health Catalyst has no effect on the direction of Certara i.e., Certara and Health Catalyst go up and down completely randomly.
Pair Corralation between Certara and Health Catalyst
Given the investment horizon of 90 days Certara is expected to under-perform the Health Catalyst. But the stock apears to be less risky and, when comparing its historical volatility, Certara is 1.5 times less risky than Health Catalyst. The stock trades about -0.04 of its potential returns per unit of risk. The Health Catalyst is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,179 in Health Catalyst on August 28, 2024 and sell it today you would lose (327.00) from holding Health Catalyst or give up 27.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Certara vs. Health Catalyst
Performance |
| Timeline |
| Certara |
| Health Catalyst |
Certara and Health Catalyst Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Certara and Health Catalyst
The main advantage of trading using opposite Certara and Health Catalyst positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Certara position performs unexpectedly, Health Catalyst 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 Health Catalyst will offset losses from the drop in Health Catalyst's long position.| Certara vs. HealthStream | Certara vs. National Research Corp | Certara vs. Forian Inc | Certara vs. HealthEquity |
| Health Catalyst vs. HealthStream | Health Catalyst vs. National Research Corp | Health Catalyst vs. Forian Inc | Health Catalyst vs. HealthEquity |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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