Correlation Between Old Mutual and Spire Healthcare
Can any of the company-specific risk be diversified away by investing in both Old Mutual and Spire Healthcare 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 Old Mutual and Spire Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Mutual and Spire Healthcare Group, you can compare the effects of market volatilities on Old Mutual and Spire Healthcare 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 Old Mutual with a short position of Spire Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Mutual and Spire Healthcare.
Diversification Opportunities for Old Mutual and Spire Healthcare
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Old and Spire is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Old Mutual and Spire Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spire Healthcare and Old Mutual 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 Old Mutual are associated (or correlated) with Spire Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spire Healthcare has no effect on the direction of Old Mutual i.e., Old Mutual and Spire Healthcare go up and down completely randomly.
Pair Corralation between Old Mutual and Spire Healthcare
Assuming the 90 days trading horizon Old Mutual is expected to generate 14.32 times more return on investment than Spire Healthcare. However, Old Mutual is 14.32 times more volatile than Spire Healthcare Group. It trades about 0.13 of its potential returns per unit of risk. Spire Healthcare Group is currently generating about -0.12 per unit of risk. If you would invest 2,106 in Old Mutual on September 12, 2024 and sell it today you would earn a total of 3,684 from holding Old Mutual or generate 174.93% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Old Mutual vs. Spire Healthcare Group
Performance |
Timeline |
Old Mutual |
Spire Healthcare |
Old Mutual and Spire Healthcare Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Old Mutual and Spire Healthcare
The main advantage of trading using opposite Old Mutual and Spire Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Mutual position performs unexpectedly, Spire Healthcare 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 Spire Healthcare will offset losses from the drop in Spire Healthcare's long position.Old Mutual vs. Blackstone Loan Financing | Old Mutual vs. Spirent Communications plc | Old Mutual vs. Verizon Communications | Old Mutual vs. Cairo Communication SpA |
Spire Healthcare vs. Smithson Investment Trust | Spire Healthcare vs. Microchip Technology | Spire Healthcare vs. Ocean Harvest Technology | Spire Healthcare vs. Schroders Investment Trusts |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |