Correlation Between Doximity and CareMax
Can any of the company-specific risk be diversified away by investing in both Doximity and CareMax 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 CareMax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doximity and CareMax, you can compare the effects of market volatilities on Doximity and CareMax 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 CareMax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doximity and CareMax.
Diversification Opportunities for Doximity and CareMax
Excellent diversification
The 3 months correlation between Doximity and CareMax is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Doximity and CareMax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareMax 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 CareMax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareMax has no effect on the direction of Doximity i.e., Doximity and CareMax go up and down completely randomly.
Pair Corralation between Doximity and CareMax
Given the investment horizon of 90 days Doximity is expected to generate 0.22 times more return on investment than CareMax. However, Doximity is 4.6 times less risky than CareMax. It trades about 0.09 of its potential returns per unit of risk. CareMax is currently generating about -0.02 per unit of risk. If you would invest 2,094 in Doximity on August 25, 2024 and sell it today you would earn a total of 2,726 from holding Doximity or generate 130.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doximity vs. CareMax
Performance |
| Timeline |
| Doximity |
| CareMax |
Doximity and CareMax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doximity and CareMax
The main advantage of trading using opposite Doximity and CareMax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doximity position performs unexpectedly, CareMax 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 CareMax will offset losses from the drop in CareMax's long position.| Doximity vs. HealthStream | Doximity vs. National Research Corp | Doximity vs. Forian Inc | Doximity vs. HealthEquity |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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