Correlation Between Genfit and Cardinal Health
Can any of the company-specific risk be diversified away by investing in both Genfit and Cardinal Health 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 Genfit and Cardinal Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genfit and Cardinal Health, you can compare the effects of market volatilities on Genfit and Cardinal Health 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 Genfit with a short position of Cardinal Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genfit and Cardinal Health.
Diversification Opportunities for Genfit and Cardinal Health
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Genfit and Cardinal is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Genfit and Cardinal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardinal Health and Genfit 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 Genfit are associated (or correlated) with Cardinal Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardinal Health has no effect on the direction of Genfit i.e., Genfit and Cardinal Health go up and down completely randomly.
Pair Corralation between Genfit and Cardinal Health
Given the investment horizon of 90 days Genfit is expected to under-perform the Cardinal Health. In addition to that, Genfit is 2.18 times more volatile than Cardinal Health. It trades about -0.44 of its total potential returns per unit of risk. Cardinal Health is currently generating about -0.21 per unit of volatility. If you would invest 12,533 in Cardinal Health on September 14, 2024 and sell it today you would lose (787.00) from holding Cardinal Health or give up 6.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genfit vs. Cardinal Health
Performance |
| Timeline |
| Genfit |
| Cardinal Health |
Genfit and Cardinal Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genfit and Cardinal Health
The main advantage of trading using opposite Genfit and Cardinal Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genfit position performs unexpectedly, Cardinal Health 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 Cardinal Health will offset losses from the drop in Cardinal Health's long position.| Genfit vs. Puma Biotechnology | Genfit vs. Iovance Biotherapeutics | Genfit vs. Sarepta Therapeutics | Genfit vs. Day One Biopharmaceuticals |
| Cardinal Health vs. Henry Schein | Cardinal Health vs. Owens Minor | Cardinal Health vs. Patterson Companies | Cardinal Health vs. McKesson |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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