Correlation Between Cardinal Health and MIRAMAR HOTEL
Can any of the company-specific risk be diversified away by investing in both Cardinal Health and MIRAMAR HOTEL 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 MIRAMAR HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cardinal Health and MIRAMAR HOTEL INV, you can compare the effects of market volatilities on Cardinal Health and MIRAMAR HOTEL 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 MIRAMAR HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cardinal Health and MIRAMAR HOTEL.
Diversification Opportunities for Cardinal Health and MIRAMAR HOTEL
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cardinal and MIRAMAR is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Cardinal Health and MIRAMAR HOTEL INV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MIRAMAR HOTEL INV 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 MIRAMAR HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MIRAMAR HOTEL INV has no effect on the direction of Cardinal Health i.e., Cardinal Health and MIRAMAR HOTEL go up and down completely randomly.
Pair Corralation between Cardinal Health and MIRAMAR HOTEL
Assuming the 90 days horizon Cardinal Health is expected to generate 1.38 times less return on investment than MIRAMAR HOTEL. But when comparing it to its historical volatility, Cardinal Health is 1.74 times less risky than MIRAMAR HOTEL. It trades about 0.08 of its potential returns per unit of risk. MIRAMAR HOTEL INV is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 55.00 in MIRAMAR HOTEL INV on October 18, 2024 and sell it today you would earn a total of 58.00 from holding MIRAMAR HOTEL INV or generate 105.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cardinal Health vs. MIRAMAR HOTEL INV
Performance |
| Timeline |
| Cardinal Health |
| MIRAMAR HOTEL INV |
Cardinal Health and MIRAMAR HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cardinal Health and MIRAMAR HOTEL
The main advantage of trading using opposite Cardinal Health and MIRAMAR HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cardinal Health position performs unexpectedly, MIRAMAR HOTEL 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 MIRAMAR HOTEL will offset losses from the drop in MIRAMAR HOTEL's long position.| Cardinal Health vs. Heidelberg Materials AG | Cardinal Health vs. KENEDIX OFFICE INV | Cardinal Health vs. Taylor Morrison Home | Cardinal Health vs. VULCAN MATERIALS |
| MIRAMAR HOTEL vs. MPH Health Care | MIRAMAR HOTEL vs. Cardinal Health | MIRAMAR HOTEL vs. CLOVER HEALTH INV | MIRAMAR HOTEL vs. Computershare Limited |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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