Correlation Between Option Care and Ambea AB
Can any of the company-specific risk be diversified away by investing in both Option Care and Ambea AB 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 Option Care and Ambea AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Option Care Health and Ambea AB, you can compare the effects of market volatilities on Option Care and Ambea AB 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 Option Care with a short position of Ambea AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Option Care and Ambea AB.
Diversification Opportunities for Option Care and Ambea AB
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Option and Ambea is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Option Care Health and Ambea AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ambea AB and Option Care 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 Option Care Health are associated (or correlated) with Ambea AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ambea AB has no effect on the direction of Option Care i.e., Option Care and Ambea AB go up and down completely randomly.
Pair Corralation between Option Care and Ambea AB
Assuming the 90 days trading horizon Option Care Health is expected to under-perform the Ambea AB. But the stock apears to be less risky and, when comparing its historical volatility, Option Care Health is 1.41 times less risky than Ambea AB. The stock trades about -0.04 of its potential returns per unit of risk. The Ambea AB is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 315.00 in Ambea AB on September 12, 2024 and sell it today you would earn a total of 558.00 from holding Ambea AB or generate 177.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Option Care Health vs. Ambea AB
Performance |
| Timeline |
| Option Care Health |
| Ambea AB |
Option Care and Ambea AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Option Care and Ambea AB
The main advantage of trading using opposite Option Care and Ambea AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Option Care position performs unexpectedly, Ambea AB 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 Ambea AB will offset losses from the drop in Ambea AB's long position.| Option Care vs. BROADSTNET LEADL 00025 | Option Care vs. CSSC Offshore Marine | Option Care vs. Liberty Broadband | Option Care vs. Jacquet Metal Service |
| Ambea AB vs. LION ONE METALS | Ambea AB vs. SERI INDUSTRIAL EO | Ambea AB vs. ADRIATIC METALS LS 013355 | Ambea AB vs. MCEWEN MINING INC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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