Correlation Between Cardinal Health and SAN MIGUEL
Can any of the company-specific risk be diversified away by investing in both Cardinal Health and SAN MIGUEL 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 Cardinal Health and SAN MIGUEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Health and SAN MIGUEL BREWERY, you can compare the effects of market volatilities on Cardinal Health and SAN MIGUEL 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 Cardinal Health with a short position of SAN MIGUEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Health and SAN MIGUEL.
Diversification Opportunities for Cardinal Health and SAN MIGUEL
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cardinal and SAN is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Health and SAN MIGUEL BREWERY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAN MIGUEL BREWERY and Cardinal Health 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 Cardinal Health are associated (or correlated) with SAN MIGUEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAN MIGUEL BREWERY has no effect on the direction of Cardinal Health i.e., Cardinal Health and SAN MIGUEL go up and down completely randomly.
Pair Corralation between Cardinal Health and SAN MIGUEL
Assuming the 90 days horizon Cardinal Health is expected to generate 0.35 times more return on investment than SAN MIGUEL. However, Cardinal Health is 2.86 times less risky than SAN MIGUEL. It trades about 0.17 of its potential returns per unit of risk. SAN MIGUEL BREWERY is currently generating about -0.01 per unit of risk. If you would invest 8,678 in Cardinal Health on October 18, 2024 and sell it today you would earn a total of 3,457 from holding Cardinal Health or generate 39.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cardinal Health vs. SAN MIGUEL BREWERY
Performance |
| Timeline |
| Cardinal Health |
| SAN MIGUEL BREWERY |
Cardinal Health and SAN MIGUEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Health and SAN MIGUEL
The main advantage of trading using opposite Cardinal Health and SAN MIGUEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Health position performs unexpectedly, SAN MIGUEL 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 SAN MIGUEL will offset losses from the drop in SAN MIGUEL's long position.| Cardinal Health vs. Calibre Mining Corp | Cardinal Health vs. GALENA MINING LTD | Cardinal Health vs. Sims Metal Management | Cardinal Health vs. Rocket Internet SE |
| SAN MIGUEL vs. CARDINAL HEALTH | SAN MIGUEL vs. Coffee Holding Co | SAN MIGUEL vs. CVS Health | SAN MIGUEL vs. Cardinal Health |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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