Correlation Between Forian and CareCloud
Can any of the company-specific risk be diversified away by investing in both Forian and CareCloud 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 Forian and CareCloud into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forian Inc and CareCloud, you can compare the effects of market volatilities on Forian and CareCloud 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 Forian with a short position of CareCloud. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forian and CareCloud.
Diversification Opportunities for Forian and CareCloud
Very good diversification
The 3 months correlation between Forian and CareCloud is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Forian Inc and CareCloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareCloud and Forian 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 Forian Inc are associated (or correlated) with CareCloud. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareCloud has no effect on the direction of Forian i.e., Forian and CareCloud go up and down completely randomly.
Pair Corralation between Forian and CareCloud
Given the investment horizon of 90 days Forian is expected to generate 10.43 times less return on investment than CareCloud. But when comparing it to its historical volatility, Forian Inc is 3.28 times less risky than CareCloud. It trades about 0.07 of its potential returns per unit of risk. CareCloud is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,247 in CareCloud on August 31, 2024 and sell it today you would earn a total of 451.00 from holding CareCloud or generate 36.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forian Inc vs. CareCloud
Performance |
| Timeline |
| Forian Inc |
| CareCloud |
Forian and CareCloud Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forian and CareCloud
The main advantage of trading using opposite Forian and CareCloud positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forian position performs unexpectedly, CareCloud 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 CareCloud will offset losses from the drop in CareCloud's long position.| Forian vs. HealthStream | Forian vs. National Research Corp | Forian vs. HealthEquity | Forian vs. Health Catalyst |
| CareCloud vs. Evolent Health | CareCloud vs. Simulations Plus | CareCloud vs. Privia Health Group | CareCloud vs. HealthStream |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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