Correlation Between Nextgen Healthcare and Premier
Can any of the company-specific risk be diversified away by investing in both Nextgen Healthcare and Premier 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 Nextgen Healthcare and Premier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nextgen Healthcare and Premier, you can compare the effects of market volatilities on Nextgen Healthcare and Premier 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 Nextgen Healthcare with a short position of Premier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nextgen Healthcare and Premier.
Diversification Opportunities for Nextgen Healthcare and Premier
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Nextgen and Premier is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Nextgen Healthcare and Premier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premier and Nextgen 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 Nextgen Healthcare are associated (or correlated) with Premier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premier has no effect on the direction of Nextgen Healthcare i.e., Nextgen Healthcare and Premier go up and down completely randomly.
Pair Corralation between Nextgen Healthcare and Premier
If you would invest 1,921 in Premier on November 1, 2024 and sell it today you would earn a total of 359.00 from holding Premier or generate 18.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 1.23% |
| Values | Daily Returns |
Nextgen Healthcare vs. Premier
Performance |
| Timeline |
| Nextgen Healthcare |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Premier |
Nextgen Healthcare and Premier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nextgen Healthcare and Premier
The main advantage of trading using opposite Nextgen Healthcare and Premier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nextgen Healthcare position performs unexpectedly, Premier 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 Premier will offset losses from the drop in Premier's long position.| Nextgen Healthcare vs. National Research Corp | Nextgen Healthcare vs. Definitive Healthcare Corp | Nextgen Healthcare vs. HealthStream | Nextgen Healthcare vs. Forian Inc |
| Premier vs. National Research Corp | Premier vs. Definitive Healthcare Corp | Premier vs. HealthStream | Premier vs. Privia Health Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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