Correlation Between Hillman Solutions and SunLink Health
Can any of the company-specific risk be diversified away by investing in both Hillman Solutions and SunLink 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 Hillman Solutions and SunLink Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hillman Solutions Corp and SunLink Health Systems, you can compare the effects of market volatilities on Hillman Solutions and SunLink 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 Hillman Solutions with a short position of SunLink Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hillman Solutions and SunLink Health.
Diversification Opportunities for Hillman Solutions and SunLink Health
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hillman and SunLink is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Hillman Solutions Corp and SunLink Health Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunLink Health Systems and Hillman Solutions 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 Hillman Solutions Corp are associated (or correlated) with SunLink Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunLink Health Systems has no effect on the direction of Hillman Solutions i.e., Hillman Solutions and SunLink Health go up and down completely randomly.
Pair Corralation between Hillman Solutions and SunLink Health
Given the investment horizon of 90 days Hillman Solutions Corp is expected to under-perform the SunLink Health. But the stock apears to be less risky and, when comparing its historical volatility, Hillman Solutions Corp is 3.31 times less risky than SunLink Health. The stock trades about -0.1 of its potential returns per unit of risk. The SunLink Health Systems is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 86.00 in SunLink Health Systems on December 1, 2024 and sell it today you would earn a total of 23.00 from holding SunLink Health Systems or generate 26.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hillman Solutions Corp vs. SunLink Health Systems
Performance |
| Timeline |
| Hillman Solutions Corp |
| SunLink Health Systems |
Hillman Solutions and SunLink Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hillman Solutions and SunLink Health
The main advantage of trading using opposite Hillman Solutions and SunLink Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hillman Solutions position performs unexpectedly, SunLink 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 SunLink Health will offset losses from the drop in SunLink Health's long position.| Hillman Solutions vs. Kennametal | Hillman Solutions vs. AB SKF | Hillman Solutions vs. Eastern Co | Hillman Solutions vs. Timken Company |
| SunLink Health vs. Allstar Health Brands | SunLink Health vs. Kiaro Holdings Corp | SunLink Health vs. China Jo Jo Drugstores | SunLink Health vs. PetMed Express |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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