Correlation Between Clover Health and Bright Health
Can any of the company-specific risk be diversified away by investing in both Clover Health and Bright 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 Clover Health and Bright Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clover Health Investments and Bright Health Group, you can compare the effects of market volatilities on Clover Health and Bright 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 Clover Health with a short position of Bright Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clover Health and Bright Health.
Diversification Opportunities for Clover Health and Bright Health
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Clover and Bright is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Clover Health Investments and Bright Health Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bright Health Group and Clover 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 Clover Health Investments are associated (or correlated) with Bright Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bright Health Group has no effect on the direction of Clover Health i.e., Clover Health and Bright Health go up and down completely randomly.
Pair Corralation between Clover Health and Bright Health
If you would invest 93.00 in Clover Health Investments on August 24, 2024 and sell it today you would earn a total of 243.00 from holding Clover Health Investments or generate 261.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
Clover Health Investments vs. Bright Health Group
Performance |
| Timeline |
| Clover Health Investments |
| Bright Health Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Clover Health and Bright Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clover Health and Bright Health
The main advantage of trading using opposite Clover Health and Bright Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clover Health position performs unexpectedly, Bright 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 Bright Health will offset losses from the drop in Bright Health's long position.| Clover Health vs. Skillz Platform | Clover Health vs. BlackBerry | Clover Health vs. Fubotv Inc | Clover Health vs. SNDL Inc |
| Bright Health vs. Alignment Healthcare LLC | Bright Health vs. Molina Healthcare | Bright Health vs. Clover Health Investments | Bright Health vs. Centene Corp |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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