Correlation Between National HealthCare and Ensign
Can any of the company-specific risk be diversified away by investing in both National HealthCare and Ensign 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 National HealthCare and Ensign into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National HealthCare and The Ensign Group, you can compare the effects of market volatilities on National HealthCare and Ensign 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 National HealthCare with a short position of Ensign. Check out your portfolio center. Please also check ongoing floating volatility patterns of National HealthCare and Ensign.
Diversification Opportunities for National HealthCare and Ensign
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between National and Ensign is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding National HealthCare and The Ensign Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensign Group and National HealthCare 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 National HealthCare are associated (or correlated) with Ensign. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensign Group has no effect on the direction of National HealthCare i.e., National HealthCare and Ensign go up and down completely randomly.
Pair Corralation between National HealthCare and Ensign
Considering the 90-day investment horizon National HealthCare is expected to under-perform the Ensign. In addition to that, National HealthCare is 1.38 times more volatile than The Ensign Group. It trades about -0.04 of its total potential returns per unit of risk. The Ensign Group is currently generating about -0.02 per unit of volatility. If you would invest 14,860 in The Ensign Group on August 28, 2024 and sell it today you would lose (340.00) from holding The Ensign Group or give up 2.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National HealthCare vs. The Ensign Group
Performance |
| Timeline |
| National HealthCare |
| Ensign Group |
National HealthCare and Ensign Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National HealthCare and Ensign
The main advantage of trading using opposite National HealthCare and Ensign positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National HealthCare position performs unexpectedly, Ensign 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 Ensign will offset losses from the drop in Ensign's long position.| National HealthCare vs. The Ensign Group | National HealthCare vs. US Physicalrapy | National HealthCare vs. Cass Information Systems | National HealthCare vs. Brookdale Senior Living |
| Ensign vs. Enhabit | Ensign vs. Pennant Group | Ensign vs. InnovAge Holding Corp | Ensign vs. National HealthCare |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |