Correlation Between Electrocore LLC and Acadia Healthcare
Can any of the company-specific risk be diversified away by investing in both Electrocore LLC and Acadia Healthcare 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 Electrocore LLC and Acadia Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electrocore LLC and Acadia Healthcare, you can compare the effects of market volatilities on Electrocore LLC and Acadia Healthcare 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 Electrocore LLC with a short position of Acadia Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electrocore LLC and Acadia Healthcare.
Diversification Opportunities for Electrocore LLC and Acadia Healthcare
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Electrocore and Acadia is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Electrocore LLC and Acadia Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadia Healthcare and Electrocore LLC 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 Electrocore LLC are associated (or correlated) with Acadia Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadia Healthcare has no effect on the direction of Electrocore LLC i.e., Electrocore LLC and Acadia Healthcare go up and down completely randomly.
Pair Corralation between Electrocore LLC and Acadia Healthcare
Given the investment horizon of 90 days Electrocore LLC is expected to generate 2.09 times more return on investment than Acadia Healthcare. However, Electrocore LLC is 2.09 times more volatile than Acadia Healthcare. It trades about 0.05 of its potential returns per unit of risk. Acadia Healthcare is currently generating about -0.06 per unit of risk. If you would invest 545.00 in Electrocore LLC on August 24, 2024 and sell it today you would earn a total of 576.00 from holding Electrocore LLC or generate 105.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Electrocore LLC vs. Acadia Healthcare
Performance |
| Timeline |
| Electrocore LLC |
| Acadia Healthcare |
Electrocore LLC and Acadia Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electrocore LLC and Acadia Healthcare
The main advantage of trading using opposite Electrocore LLC and Acadia Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electrocore LLC position performs unexpectedly, Acadia Healthcare 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 Acadia Healthcare will offset losses from the drop in Acadia Healthcare's long position.| Electrocore LLC vs. STRATA Skin Sciences | Electrocore LLC vs. Sight Sciences | Electrocore LLC vs. Neuropace | Electrocore LLC vs. IRIDEX |
| Acadia Healthcare vs. Encompass Health Corp | Acadia Healthcare vs. Pennant Group | Acadia Healthcare vs. Select Medical Holdings | Acadia Healthcare vs. Addus HomeCare |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |