Correlation Between CVS Health and Beyond Air
Can any of the company-specific risk be diversified away by investing in both CVS Health and Beyond Air 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 Beyond Air 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 Beyond Air, you can compare the effects of market volatilities on CVS Health and Beyond Air 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 Beyond Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and Beyond Air.
Diversification Opportunities for CVS Health and Beyond Air
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CVS and Beyond is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding CVS Health Corp and Beyond Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Air 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 Beyond Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Air has no effect on the direction of CVS Health i.e., CVS Health and Beyond Air go up and down completely randomly.
Pair Corralation between CVS Health and Beyond Air
Considering the 90-day investment horizon CVS Health Corp is expected to generate 0.34 times more return on investment than Beyond Air. However, CVS Health Corp is 2.96 times less risky than Beyond Air. It trades about 0.01 of its potential returns per unit of risk. Beyond Air is currently generating about -0.07 per unit of risk. If you would invest 6,845 in CVS Health Corp on January 11, 2025 and sell it today you would lose (38.00) from holding CVS Health Corp or give up 0.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
CVS Health Corp vs. Beyond Air
Performance |
| Timeline |
| CVS Health Corp |
| Beyond Air |
CVS Health and Beyond Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVS Health and Beyond Air
The main advantage of trading using opposite CVS Health and Beyond Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS Health position performs unexpectedly, Beyond Air 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 Beyond Air will offset losses from the drop in Beyond Air's long position.| CVS Health vs. Acadia Healthcare | CVS Health vs. Tenet Healthcare | CVS Health vs. HCA Holdings | CVS Health vs. US Physicalrapy |
| Beyond Air vs. Lucid Diagnostics | Beyond Air vs. PAVmed Series Z | Beyond Air vs. Clearpoint Neuro | Beyond Air vs. Avita Medical |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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