Correlation Between Henry Schein and Cencora
Can any of the company-specific risk be diversified away by investing in both Henry Schein and Cencora 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 Henry Schein and Cencora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Henry Schein and Cencora, you can compare the effects of market volatilities on Henry Schein and Cencora 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 Henry Schein with a short position of Cencora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Henry Schein and Cencora.
Diversification Opportunities for Henry Schein and Cencora
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Henry and Cencora is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Henry Schein and Cencora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cencora and Henry Schein 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 Henry Schein are associated (or correlated) with Cencora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cencora has no effect on the direction of Henry Schein i.e., Henry Schein and Cencora go up and down completely randomly.
Pair Corralation between Henry Schein and Cencora
Given the investment horizon of 90 days Henry Schein is expected to under-perform the Cencora. In addition to that, Henry Schein is 1.41 times more volatile than Cencora. It trades about 0.0 of its total potential returns per unit of risk. Cencora is currently generating about 0.07 per unit of volatility. If you would invest 16,592 in Cencora on September 12, 2024 and sell it today you would earn a total of 6,708 from holding Cencora or generate 40.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Henry Schein vs. Cencora
Performance |
| Timeline |
| Henry Schein |
| Cencora |
Henry Schein and Cencora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Henry Schein and Cencora
The main advantage of trading using opposite Henry Schein and Cencora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Henry Schein position performs unexpectedly, Cencora 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 Cencora will offset losses from the drop in Cencora's long position.| Henry Schein vs. Owens Minor | Henry Schein vs. Cardinal Health | Henry Schein vs. Zynex Inc | Henry Schein vs. Patterson Companies |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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