Correlation Between Flex and Sonida Senior
Can any of the company-specific risk be diversified away by investing in both Flex and Sonida Senior 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 Flex and Sonida Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flex and Sonida Senior Living, you can compare the effects of market volatilities on Flex and Sonida Senior 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 Flex with a short position of Sonida Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flex and Sonida Senior.
Diversification Opportunities for Flex and Sonida Senior
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Flex and Sonida is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Flex and Sonida Senior Living in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonida Senior Living and Flex 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 Flex are associated (or correlated) with Sonida Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonida Senior Living has no effect on the direction of Flex i.e., Flex and Sonida Senior go up and down completely randomly.
Pair Corralation between Flex and Sonida Senior
Given the investment horizon of 90 days Flex is expected to generate 0.63 times more return on investment than Sonida Senior. However, Flex is 1.58 times less risky than Sonida Senior. It trades about 0.08 of its potential returns per unit of risk. Sonida Senior Living is currently generating about 0.0 per unit of risk. If you would invest 3,364 in Flex on August 26, 2024 and sell it today you would earn a total of 766.00 from holding Flex or generate 22.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flex vs. Sonida Senior Living
Performance |
| Timeline |
| Flex |
| Sonida Senior Living |
Flex and Sonida Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flex and Sonida Senior
The main advantage of trading using opposite Flex and Sonida Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flex position performs unexpectedly, Sonida Senior 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 Sonida Senior will offset losses from the drop in Sonida Senior's long position.The idea behind Flex and Sonida Senior Living pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sonida Senior vs. Heartbeam | Sonida Senior vs. EUDA Health Holdings | Sonida Senior vs. Nutex Health | Sonida Senior vs. Healthcare Triangle |
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.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |