Correlation Between COMINTL BANK and National Health
Can any of the company-specific risk be diversified away by investing in both COMINTL BANK and National 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 COMINTL BANK and National Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COMINTL BANK ADR1 and National Health Investors, you can compare the effects of market volatilities on COMINTL BANK and National 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 COMINTL BANK with a short position of National Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMINTL BANK and National Health.
Diversification Opportunities for COMINTL BANK and National Health
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between COMINTL and National is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding COMINTL BANK ADR1 and National Health Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Health Investors and COMINTL BANK 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 COMINTL BANK ADR1 are associated (or correlated) with National Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Health Investors has no effect on the direction of COMINTL BANK i.e., COMINTL BANK and National Health go up and down completely randomly.
Pair Corralation between COMINTL BANK and National Health
Assuming the 90 days trading horizon COMINTL BANK ADR1 is expected to under-perform the National Health. In addition to that, COMINTL BANK is 1.24 times more volatile than National Health Investors. It trades about -0.02 of its total potential returns per unit of risk. National Health Investors is currently generating about 0.1 per unit of volatility. If you would invest 5,793 in National Health Investors on September 3, 2024 and sell it today you would earn a total of 1,457 from holding National Health Investors or generate 25.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COMINTL BANK ADR1 vs. National Health Investors
Performance |
| Timeline |
| COMINTL BANK ADR1 |
| National Health Investors |
COMINTL BANK and National Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMINTL BANK and National Health
The main advantage of trading using opposite COMINTL BANK and National Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMINTL BANK position performs unexpectedly, National 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 National Health will offset losses from the drop in National Health's long position.| COMINTL BANK vs. Superior Plus Corp | COMINTL BANK vs. NMI Holdings | COMINTL BANK vs. Origin Agritech | COMINTL BANK vs. SIVERS SEMICONDUCTORS AB |
| National Health vs. Apple Inc | National Health vs. Apple Inc | National Health vs. Apple Inc | National Health vs. Apple Inc |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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