Correlation Between Definitive Healthcare and AtriCure
Can any of the company-specific risk be diversified away by investing in both Definitive Healthcare 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 Definitive Healthcare and AtriCure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Definitive Healthcare Corp and AtriCure, you can compare the effects of market volatilities on Definitive Healthcare 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 Definitive Healthcare with a short position of AtriCure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Definitive Healthcare and AtriCure.
Diversification Opportunities for Definitive Healthcare and AtriCure
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Definitive and AtriCure is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Definitive Healthcare Corp and AtriCure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AtriCure and Definitive Healthcare 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 Definitive Healthcare 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 Definitive Healthcare i.e., Definitive Healthcare and AtriCure go up and down completely randomly.
Pair Corralation between Definitive Healthcare and AtriCure
Allowing for the 90-day total investment horizon Definitive Healthcare Corp is expected to generate 0.99 times more return on investment than AtriCure. However, Definitive Healthcare Corp is 1.01 times less risky than AtriCure. It trades about 0.21 of its potential returns per unit of risk. AtriCure is currently generating about 0.08 per unit of risk. If you would invest 416.00 in Definitive Healthcare Corp on August 31, 2024 and sell it today you would earn a total of 50.00 from holding Definitive Healthcare Corp or generate 12.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Definitive Healthcare Corp vs. AtriCure
Performance |
| Timeline |
| Definitive Healthcare |
| AtriCure |
Definitive Healthcare and AtriCure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Definitive Healthcare and AtriCure
The main advantage of trading using opposite Definitive Healthcare and AtriCure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Definitive Healthcare 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.| Definitive Healthcare vs. Evolent Health | Definitive Healthcare vs. Simulations Plus | Definitive Healthcare vs. Privia Health Group | Definitive Healthcare vs. HealthStream |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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