Correlation Between Fortress Transp and American Healthcare
Can any of the company-specific risk be diversified away by investing in both Fortress Transp and American 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 Fortress Transp and American Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortress Transp Infra and American Healthcare REIT,, you can compare the effects of market volatilities on Fortress Transp and American 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 Fortress Transp with a short position of American Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortress Transp and American Healthcare.
Diversification Opportunities for Fortress Transp and American Healthcare
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fortress and American is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Fortress Transp Infra and American Healthcare REIT, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Healthcare REIT, and Fortress Transp 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 Fortress Transp Infra are associated (or correlated) with American Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Healthcare REIT, has no effect on the direction of Fortress Transp i.e., Fortress Transp and American Healthcare go up and down completely randomly.
Pair Corralation between Fortress Transp and American Healthcare
Given the investment horizon of 90 days Fortress Transp Infra is expected to generate 1.43 times more return on investment than American Healthcare. However, Fortress Transp is 1.43 times more volatile than American Healthcare REIT,. It trades about 0.21 of its potential returns per unit of risk. American Healthcare REIT, is currently generating about 0.25 per unit of risk. If you would invest 1,564 in Fortress Transp Infra on August 27, 2024 and sell it today you would earn a total of 15,807 from holding Fortress Transp Infra or generate 1010.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 40.93% |
| Values | Daily Returns |
Fortress Transp Infra vs. American Healthcare REIT,
Performance |
| Timeline |
| Fortress Transp Infra |
| American Healthcare REIT, |
Fortress Transp and American Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortress Transp and American Healthcare
The main advantage of trading using opposite Fortress Transp and American Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortress Transp position performs unexpectedly, American 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 American Healthcare will offset losses from the drop in American Healthcare's long position.| Fortress Transp vs. McGrath RentCorp | Fortress Transp vs. Custom Truck One | Fortress Transp vs. Herc Holdings | Fortress Transp vs. Alta Equipment Group |
| American Healthcare vs. Marfrig Global Foods | American Healthcare vs. Custom Truck One | American Healthcare vs. Lendlease Global Commercial | American Healthcare vs. Fortress Transp Infra |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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