Correlation Between Inogen and Sonida Senior
Can any of the company-specific risk be diversified away by investing in both Inogen and Sonida Senior 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 Inogen and Sonida Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inogen Inc and Sonida Senior Living, you can compare the effects of market volatilities on Inogen and Sonida Senior 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 Inogen with a short position of Sonida Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inogen and Sonida Senior.
Diversification Opportunities for Inogen and Sonida Senior
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Inogen and Sonida is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Inogen Inc and Sonida Senior Living in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sonida Senior Living and Inogen 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 Inogen Inc are associated (or correlated) with Sonida Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sonida Senior Living has no effect on the direction of Inogen i.e., Inogen and Sonida Senior go up and down completely randomly.
Pair Corralation between Inogen and Sonida Senior
Given the investment horizon of 90 days Inogen Inc is expected to under-perform the Sonida Senior. But the stock apears to be less risky and, when comparing its historical volatility, Inogen Inc is 1.06 times less risky than Sonida Senior. The stock trades about -0.01 of its potential returns per unit of risk. The Sonida Senior Living is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,201 in Sonida Senior Living on September 17, 2024 and sell it today you would earn a total of 1,306 from holding Sonida Senior Living or generate 108.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Inogen Inc vs. Sonida Senior Living
Performance |
| Timeline |
| Inogen Inc |
| Sonida Senior Living |
Inogen and Sonida Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inogen and Sonida Senior
The main advantage of trading using opposite Inogen and Sonida Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inogen position performs unexpectedly, Sonida Senior 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 Sonida Senior will offset losses from the drop in Sonida Senior's long position.The idea behind Inogen Inc and Sonida Senior Living pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sonida Senior vs. Avita Medical | Sonida Senior vs. Treace Medical Concepts | Sonida Senior vs. Inogen Inc | Sonida Senior vs. Apyx Medical |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |