Correlation Between Ensign and Airsculpt Technologies
Can any of the company-specific risk be diversified away by investing in both Ensign and Airsculpt Technologies 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 Ensign and Airsculpt Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Ensign Group and Airsculpt Technologies, you can compare the effects of market volatilities on Ensign and Airsculpt Technologies 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 Ensign with a short position of Airsculpt Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ensign and Airsculpt Technologies.
Diversification Opportunities for Ensign and Airsculpt Technologies
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ensign and Airsculpt is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding The Ensign Group and Airsculpt Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airsculpt Technologies and Ensign 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 The Ensign Group are associated (or correlated) with Airsculpt Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airsculpt Technologies has no effect on the direction of Ensign i.e., Ensign and Airsculpt Technologies go up and down completely randomly.
Pair Corralation between Ensign and Airsculpt Technologies
Given the investment horizon of 90 days Ensign is expected to generate 2.44 times less return on investment than Airsculpt Technologies. But when comparing it to its historical volatility, The Ensign Group is 3.54 times less risky than Airsculpt Technologies. It trades about 0.08 of its potential returns per unit of risk. Airsculpt Technologies is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 352.00 in Airsculpt Technologies on August 24, 2024 and sell it today you would earn a total of 348.00 from holding Airsculpt Technologies or generate 98.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Ensign Group vs. Airsculpt Technologies
Performance |
| Timeline |
| Ensign Group |
| Airsculpt Technologies |
Ensign and Airsculpt Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ensign and Airsculpt Technologies
The main advantage of trading using opposite Ensign and Airsculpt Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ensign position performs unexpectedly, Airsculpt Technologies 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 Airsculpt Technologies will offset losses from the drop in Airsculpt Technologies' long position.| Ensign vs. Enhabit | Ensign vs. Pennant Group | Ensign vs. InnovAge Holding Corp | Ensign vs. National HealthCare |
| Airsculpt Technologies vs. Acadia Healthcare | Airsculpt Technologies vs. Pennant Group | Airsculpt Technologies vs. Amedisys | Airsculpt Technologies vs. The Ensign Group |
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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