Correlation Between Definitive Healthcare and Owens Minor
Can any of the company-specific risk be diversified away by investing in both Definitive Healthcare and Owens Minor 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 Owens Minor 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 Owens Minor, you can compare the effects of market volatilities on Definitive Healthcare and Owens Minor 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 Owens Minor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Definitive Healthcare and Owens Minor.
Diversification Opportunities for Definitive Healthcare and Owens Minor
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Definitive and Owens is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Definitive Healthcare Corp and Owens Minor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Owens Minor 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 Owens Minor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Owens Minor has no effect on the direction of Definitive Healthcare i.e., Definitive Healthcare and Owens Minor go up and down completely randomly.
Pair Corralation between Definitive Healthcare and Owens Minor
Allowing for the 90-day total investment horizon Definitive Healthcare Corp is expected to generate 0.44 times more return on investment than Owens Minor. However, Definitive Healthcare Corp is 2.27 times less risky than Owens Minor. It trades about 0.11 of its potential returns per unit of risk. Owens Minor is currently generating about 0.05 per unit of risk. If you would invest 422.00 in Definitive Healthcare Corp on August 28, 2024 and sell it today you would earn a total of 23.00 from holding Definitive Healthcare Corp or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Definitive Healthcare Corp vs. Owens Minor
Performance |
| Timeline |
| Definitive Healthcare |
| Owens Minor |
Definitive Healthcare and Owens Minor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Definitive Healthcare and Owens Minor
The main advantage of trading using opposite Definitive Healthcare and Owens Minor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Definitive Healthcare position performs unexpectedly, Owens Minor 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 Owens Minor will offset losses from the drop in Owens Minor's long position.| Definitive Healthcare vs. HealthStream | Definitive Healthcare vs. National Research Corp | Definitive Healthcare vs. Forian Inc | Definitive Healthcare vs. HealthEquity |
| Owens Minor vs. Henry Schein | Owens Minor vs. Cardinal Health | Owens Minor vs. Zynex Inc | Owens Minor vs. Patterson Companies |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |