Correlation Between GoHealth and Burlington Stores
Can any of the company-specific risk be diversified away by investing in both GoHealth and Burlington Stores 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 GoHealth and Burlington Stores into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoHealth and Burlington Stores, you can compare the effects of market volatilities on GoHealth and Burlington Stores 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 GoHealth with a short position of Burlington Stores. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoHealth and Burlington Stores.
Diversification Opportunities for GoHealth and Burlington Stores
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between GoHealth and Burlington is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding GoHealth and Burlington Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burlington Stores and GoHealth 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 GoHealth are associated (or correlated) with Burlington Stores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burlington Stores has no effect on the direction of GoHealth i.e., GoHealth and Burlington Stores go up and down completely randomly.
Pair Corralation between GoHealth and Burlington Stores
Given the investment horizon of 90 days GoHealth is expected to generate 2.93 times more return on investment than Burlington Stores. However, GoHealth is 2.93 times more volatile than Burlington Stores. It trades about 0.07 of its potential returns per unit of risk. Burlington Stores is currently generating about 0.08 per unit of risk. If you would invest 945.00 in GoHealth on September 19, 2024 and sell it today you would earn a total of 286.00 from holding GoHealth or generate 30.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GoHealth vs. Burlington Stores
Performance |
| Timeline |
| GoHealth |
| Burlington Stores |
GoHealth and Burlington Stores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoHealth and Burlington Stores
The main advantage of trading using opposite GoHealth and Burlington Stores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoHealth position performs unexpectedly, Burlington Stores 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 Burlington Stores will offset losses from the drop in Burlington Stores' long position.| GoHealth vs. eHealth | GoHealth vs. Tian Ruixiang Holdings | GoHealth vs. Huize Holding | GoHealth vs. Selectquote |
| Burlington Stores vs. Capri Holdings | Burlington Stores vs. Movado Group | Burlington Stores vs. Tapestry | Burlington Stores vs. Brilliant Earth Group |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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