Correlation Between Encompass Health and JD Health
Can any of the company-specific risk be diversified away by investing in both Encompass Health and JD Health 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 Encompass Health and JD Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Encompass Health Corp and JD Health International, you can compare the effects of market volatilities on Encompass Health and JD Health 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 Encompass Health with a short position of JD Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Encompass Health and JD Health.
Diversification Opportunities for Encompass Health and JD Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Encompass and JDHIF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Encompass Health Corp and JD Health International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Health International and Encompass Health 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 Encompass Health Corp are associated (or correlated) with JD Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Health International has no effect on the direction of Encompass Health i.e., Encompass Health and JD Health go up and down completely randomly.
Pair Corralation between Encompass Health and JD Health
If you would invest 313.00 in JD Health International on September 12, 2024 and sell it today you would earn a total of 0.00 from holding JD Health International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Encompass Health Corp vs. JD Health International
Performance |
| Timeline |
| Encompass Health Corp |
| JD Health International |
Encompass Health and JD Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Encompass Health and JD Health
The main advantage of trading using opposite Encompass Health and JD Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Encompass Health position performs unexpectedly, JD Health 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 JD Health will offset losses from the drop in JD Health's long position.| Encompass Health vs. Pennant Group | Encompass Health vs. The Ensign Group | Encompass Health vs. InnovAge Holding Corp | Encompass Health vs. ModivCare |
| JD Health vs. Pennant Group | JD Health vs. Encompass Health Corp | JD Health vs. Enhabit | JD Health vs. Concord Medical Services |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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