Correlation Between DELTA AIR and NIGHTINGALE HEALTH
Can any of the company-specific risk be diversified away by investing in both DELTA AIR and NIGHTINGALE HEALTH 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 DELTA AIR and NIGHTINGALE HEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DELTA AIR LINES and NIGHTINGALE HEALTH EO, you can compare the effects of market volatilities on DELTA AIR and NIGHTINGALE HEALTH 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 DELTA AIR with a short position of NIGHTINGALE HEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of DELTA AIR and NIGHTINGALE HEALTH.
Diversification Opportunities for DELTA AIR and NIGHTINGALE HEALTH
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DELTA and NIGHTINGALE is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding DELTA AIR LINES and NIGHTINGALE HEALTH EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NIGHTINGALE HEALTH and DELTA AIR 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 DELTA AIR LINES are associated (or correlated) with NIGHTINGALE HEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NIGHTINGALE HEALTH has no effect on the direction of DELTA AIR i.e., DELTA AIR and NIGHTINGALE HEALTH go up and down completely randomly.
Pair Corralation between DELTA AIR and NIGHTINGALE HEALTH
Assuming the 90 days trading horizon DELTA AIR LINES is expected to generate 0.92 times more return on investment than NIGHTINGALE HEALTH. However, DELTA AIR LINES is 1.08 times less risky than NIGHTINGALE HEALTH. It trades about 0.23 of its potential returns per unit of risk. NIGHTINGALE HEALTH EO is currently generating about 0.1 per unit of risk. If you would invest 5,888 in DELTA AIR LINES on October 13, 2024 and sell it today you would earn a total of 619.00 from holding DELTA AIR LINES or generate 10.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
DELTA AIR LINES vs. NIGHTINGALE HEALTH EO
Performance |
| Timeline |
| DELTA AIR LINES |
| NIGHTINGALE HEALTH |
DELTA AIR and NIGHTINGALE HEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DELTA AIR and NIGHTINGALE HEALTH
The main advantage of trading using opposite DELTA AIR and NIGHTINGALE HEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DELTA AIR position performs unexpectedly, NIGHTINGALE HEALTH 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 NIGHTINGALE HEALTH will offset losses from the drop in NIGHTINGALE HEALTH's long position.| DELTA AIR vs. DeVry Education Group | DELTA AIR vs. Strategic Education | DELTA AIR vs. TAL Education Group | DELTA AIR vs. Japan Post Insurance |
| NIGHTINGALE HEALTH vs. DELTA AIR LINES | NIGHTINGALE HEALTH vs. Air New Zealand | NIGHTINGALE HEALTH vs. Gol Intelligent Airlines | NIGHTINGALE HEALTH vs. Pentair plc |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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