Correlation Between Cigna Corp and Catheter Precision
Can any of the company-specific risk be diversified away by investing in both Cigna Corp and Catheter Precision 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 Cigna Corp and Catheter Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cigna Corp and Catheter Precision, you can compare the effects of market volatilities on Cigna Corp and Catheter Precision 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 Cigna Corp with a short position of Catheter Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cigna Corp and Catheter Precision.
Diversification Opportunities for Cigna Corp and Catheter Precision
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cigna and Catheter is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Cigna Corp and Catheter Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catheter Precision and Cigna Corp 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 Cigna Corp are associated (or correlated) with Catheter Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catheter Precision has no effect on the direction of Cigna Corp i.e., Cigna Corp and Catheter Precision go up and down completely randomly.
Pair Corralation between Cigna Corp and Catheter Precision
Allowing for the 90-day total investment horizon Cigna Corp is expected to under-perform the Catheter Precision. But the stock apears to be less risky and, when comparing its historical volatility, Cigna Corp is 7.13 times less risky than Catheter Precision. The stock trades about -0.14 of its potential returns per unit of risk. The Catheter Precision is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 40.00 in Catheter Precision on September 28, 2024 and sell it today you would earn a total of 2.00 from holding Catheter Precision or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cigna Corp vs. Catheter Precision
Performance |
| Timeline |
| Cigna Corp |
| Catheter Precision |
Cigna Corp and Catheter Precision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cigna Corp and Catheter Precision
The main advantage of trading using opposite Cigna Corp and Catheter Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cigna Corp position performs unexpectedly, Catheter Precision 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 Catheter Precision will offset losses from the drop in Catheter Precision's long position.| Cigna Corp vs. Elevance Health | Cigna Corp vs. UnitedHealth Group Incorporated | Cigna Corp vs. Centene Corp | Cigna Corp vs. Molina Healthcare |
| Catheter Precision vs. Cigna Corp | Catheter Precision vs. Definitive Healthcare Corp | Catheter Precision vs. Guardant Health | Catheter Precision vs. Laboratory of |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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