Correlation Between Global Healthcare and Freedom Bank
Can any of the company-specific risk be diversified away by investing in both Global Healthcare and Freedom Bank 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 Global Healthcare and Freedom Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Healthcare REIT and Freedom Bank of, you can compare the effects of market volatilities on Global Healthcare and Freedom Bank 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 Global Healthcare with a short position of Freedom Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Healthcare and Freedom Bank.
Diversification Opportunities for Global Healthcare and Freedom Bank
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Global and Freedom is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Global Healthcare REIT and Freedom Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Freedom Bank and Global Healthcare 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 Global Healthcare REIT are associated (or correlated) with Freedom Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Freedom Bank has no effect on the direction of Global Healthcare i.e., Global Healthcare and Freedom Bank go up and down completely randomly.
Pair Corralation between Global Healthcare and Freedom Bank
Given the investment horizon of 90 days Global Healthcare REIT is expected to generate 12.49 times more return on investment than Freedom Bank. However, Global Healthcare is 12.49 times more volatile than Freedom Bank of. It trades about 0.02 of its potential returns per unit of risk. Freedom Bank of is currently generating about 0.03 per unit of risk. If you would invest 178.00 in Global Healthcare REIT on August 28, 2024 and sell it today you would lose (8.00) from holding Global Healthcare REIT or give up 4.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Global Healthcare REIT vs. Freedom Bank of
Performance |
| Timeline |
| Global Healthcare REIT |
| Freedom Bank |
Global Healthcare and Freedom Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Healthcare and Freedom Bank
The main advantage of trading using opposite Global Healthcare and Freedom Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Healthcare position performs unexpectedly, Freedom Bank 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 Freedom Bank will offset losses from the drop in Freedom Bank's long position.| Global Healthcare vs. Smart REIT | Global Healthcare vs. Phillips Edison Co | Global Healthcare vs. Simon Property Group | Global Healthcare vs. Inventrust Properties Corp |
| Freedom Bank vs. Washington Business Bank | Freedom Bank vs. National Capital Bank | Freedom Bank vs. Community Heritage Financial | Freedom Bank vs. Citizens Financial Corp |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |