Correlation Between HEALTHCARE REAL and Macys
Can any of the company-specific risk be diversified away by investing in both HEALTHCARE REAL and Macys 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 HEALTHCARE REAL and Macys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HEALTHCARE REAL A and Macys Inc, you can compare the effects of market volatilities on HEALTHCARE REAL and Macys 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 HEALTHCARE REAL with a short position of Macys. Check out your portfolio center. Please also check ongoing floating volatility patterns of HEALTHCARE REAL and Macys.
Diversification Opportunities for HEALTHCARE REAL and Macys
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HEALTHCARE and Macys is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding HEALTHCARE REAL A and Macys Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Macys Inc and HEALTHCARE REAL 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 HEALTHCARE REAL A are associated (or correlated) with Macys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Macys Inc has no effect on the direction of HEALTHCARE REAL i.e., HEALTHCARE REAL and Macys go up and down completely randomly.
Pair Corralation between HEALTHCARE REAL and Macys
Assuming the 90 days horizon HEALTHCARE REAL A is expected to generate 0.57 times more return on investment than Macys. However, HEALTHCARE REAL A is 1.77 times less risky than Macys. It trades about 0.07 of its potential returns per unit of risk. Macys Inc is currently generating about -0.01 per unit of risk. If you would invest 1,340 in HEALTHCARE REAL A on September 4, 2024 and sell it today you would earn a total of 360.00 from holding HEALTHCARE REAL A or generate 26.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
HEALTHCARE REAL A vs. Macys Inc
Performance |
| Timeline |
| HEALTHCARE REAL A |
| Macys Inc |
HEALTHCARE REAL and Macys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HEALTHCARE REAL and Macys
The main advantage of trading using opposite HEALTHCARE REAL and Macys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HEALTHCARE REAL position performs unexpectedly, Macys 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 Macys will offset losses from the drop in Macys' long position.| HEALTHCARE REAL vs. Apple Inc | HEALTHCARE REAL vs. Apple Inc | HEALTHCARE REAL vs. Apple Inc | HEALTHCARE REAL vs. Apple Inc |
| Macys vs. RYOHIN UNSPADR1 | Macys vs. Superior Plus Corp | Macys vs. NMI Holdings | Macys vs. Origin Agritech |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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