Correlation Between Doximity and CareCloud
Can any of the company-specific risk be diversified away by investing in both Doximity and CareCloud 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 Doximity and CareCloud into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doximity and CareCloud, you can compare the effects of market volatilities on Doximity and CareCloud 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 Doximity with a short position of CareCloud. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doximity and CareCloud.
Diversification Opportunities for Doximity and CareCloud
Poor diversification
The 3 months correlation between Doximity and CareCloud is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Doximity and CareCloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareCloud and Doximity 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 Doximity are associated (or correlated) with CareCloud. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareCloud has no effect on the direction of Doximity i.e., Doximity and CareCloud go up and down completely randomly.
Pair Corralation between Doximity and CareCloud
Given the investment horizon of 90 days Doximity is expected to generate 1.17 times less return on investment than CareCloud. In addition to that, Doximity is 1.15 times more volatile than CareCloud. It trades about 0.17 of its total potential returns per unit of risk. CareCloud is currently generating about 0.22 per unit of volatility. If you would invest 1,247 in CareCloud on August 31, 2024 and sell it today you would earn a total of 451.00 from holding CareCloud or generate 36.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doximity vs. CareCloud
Performance |
| Timeline |
| Doximity |
| CareCloud |
Doximity and CareCloud Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doximity and CareCloud
The main advantage of trading using opposite Doximity and CareCloud positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doximity position performs unexpectedly, CareCloud 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 CareCloud will offset losses from the drop in CareCloud's long position.The idea behind Doximity and CareCloud pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| CareCloud vs. Evolent Health | CareCloud vs. Simulations Plus | CareCloud vs. Privia Health Group | CareCloud 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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