Correlation Between OneSavings Bank and Worldwide Healthcare
Can any of the company-specific risk be diversified away by investing in both OneSavings Bank and Worldwide 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 OneSavings Bank and Worldwide Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OneSavings Bank PLC and Worldwide Healthcare Trust, you can compare the effects of market volatilities on OneSavings Bank and Worldwide 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 OneSavings Bank with a short position of Worldwide Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of OneSavings Bank and Worldwide Healthcare.
Diversification Opportunities for OneSavings Bank and Worldwide Healthcare
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between OneSavings and Worldwide is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding OneSavings Bank PLC and Worldwide Healthcare Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldwide Healthcare and OneSavings Bank 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 OneSavings Bank PLC are associated (or correlated) with Worldwide Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldwide Healthcare has no effect on the direction of OneSavings Bank i.e., OneSavings Bank and Worldwide Healthcare go up and down completely randomly.
Pair Corralation between OneSavings Bank and Worldwide Healthcare
Assuming the 90 days trading horizon OneSavings Bank is expected to generate 1.79 times less return on investment than Worldwide Healthcare. In addition to that, OneSavings Bank is 2.5 times more volatile than Worldwide Healthcare Trust. It trades about 0.04 of its total potential returns per unit of risk. Worldwide Healthcare Trust is currently generating about 0.19 per unit of volatility. If you would invest 31,750 in Worldwide Healthcare Trust on October 25, 2024 and sell it today you would earn a total of 1,050 from holding Worldwide Healthcare Trust or generate 3.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OneSavings Bank PLC vs. Worldwide Healthcare Trust
Performance |
| Timeline |
| OneSavings Bank PLC |
| Worldwide Healthcare |
OneSavings Bank and Worldwide Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OneSavings Bank and Worldwide Healthcare
The main advantage of trading using opposite OneSavings Bank and Worldwide Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OneSavings Bank position performs unexpectedly, Worldwide 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 Worldwide Healthcare will offset losses from the drop in Worldwide Healthcare's long position.| OneSavings Bank vs. Worldwide Healthcare Trust | OneSavings Bank vs. Roebuck Food Group | OneSavings Bank vs. Inspiration Healthcare Group | OneSavings Bank vs. Hilton Food Group |
| Worldwide Healthcare vs. Qurate Retail Series | Worldwide Healthcare vs. Cembra Money Bank | Worldwide Healthcare vs. Berner Kantonalbank AG | Worldwide Healthcare vs. Liechtensteinische Landesbank AG |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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