Correlation Between Ensign and Genesis Healthcare
Can any of the company-specific risk be diversified away by investing in both Ensign and Genesis 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 Ensign and Genesis Healthcare 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 Genesis Healthcare, you can compare the effects of market volatilities on Ensign and Genesis 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 Ensign with a short position of Genesis Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ensign and Genesis Healthcare.
Diversification Opportunities for Ensign and Genesis Healthcare
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ensign and Genesis is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding The Ensign Group and Genesis Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Healthcare 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 Genesis Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Healthcare has no effect on the direction of Ensign i.e., Ensign and Genesis Healthcare go up and down completely randomly.
Pair Corralation between Ensign and Genesis Healthcare
If you would invest 9,533 in The Ensign Group on August 29, 2024 and sell it today you would earn a total of 5,065 from holding The Ensign Group or generate 53.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.32% |
| Values | Daily Returns |
The Ensign Group vs. Genesis Healthcare
Performance |
| Timeline |
| Ensign Group |
| Genesis Healthcare |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ensign and Genesis Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ensign and Genesis Healthcare
The main advantage of trading using opposite Ensign and Genesis Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ensign position performs unexpectedly, Genesis 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 Genesis Healthcare will offset losses from the drop in Genesis Healthcare's long position.| Ensign vs. Enhabit | Ensign vs. Pennant Group | Ensign vs. InnovAge Holding Corp | Ensign vs. National HealthCare |
| Genesis Healthcare vs. Univec Inc | Genesis Healthcare vs. Ethema Health Corp | Genesis Healthcare vs. IMAC Holdings | Genesis Healthcare 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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