Correlation Between CVS Health and AtriCure
Can any of the company-specific risk be diversified away by investing in both CVS Health and AtriCure 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 CVS Health and AtriCure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVS Health Corp and AtriCure, you can compare the effects of market volatilities on CVS Health and AtriCure 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 CVS Health with a short position of AtriCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and AtriCure.
Diversification Opportunities for CVS Health and AtriCure
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CVS and AtriCure is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding CVS Health Corp and AtriCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AtriCure and CVS 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 CVS Health Corp are associated (or correlated) with AtriCure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AtriCure has no effect on the direction of CVS Health i.e., CVS Health and AtriCure go up and down completely randomly.
Pair Corralation between CVS Health and AtriCure
Considering the 90-day investment horizon CVS Health Corp is expected to generate 1.38 times more return on investment than AtriCure. However, CVS Health is 1.38 times more volatile than AtriCure. It trades about 0.09 of its potential returns per unit of risk. AtriCure is currently generating about 0.08 per unit of risk. If you would invest 5,639 in CVS Health Corp on August 31, 2024 and sell it today you would earn a total of 357.00 from holding CVS Health Corp or generate 6.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVS Health Corp vs. AtriCure
Performance |
| Timeline |
| CVS Health Corp |
| AtriCure |
CVS Health and AtriCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVS Health and AtriCure
The main advantage of trading using opposite CVS Health and AtriCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS Health position performs unexpectedly, AtriCure 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 AtriCure will offset losses from the drop in AtriCure's long position.| CVS Health vs. Humana Inc | CVS Health vs. Cigna Corp | CVS Health vs. Elevance Health | CVS 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |