Correlation Between Performant Financial and CBIZ
Can any of the company-specific risk be diversified away by investing in both Performant Financial and CBIZ 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 Performant Financial and CBIZ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performant Financial and CBIZ Inc, you can compare the effects of market volatilities on Performant Financial and CBIZ 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 Performant Financial with a short position of CBIZ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performant Financial and CBIZ.
Diversification Opportunities for Performant Financial and CBIZ
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Performant and CBIZ is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Performant Financial and CBIZ Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBIZ Inc and Performant Financial 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 Performant Financial are associated (or correlated) with CBIZ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBIZ Inc has no effect on the direction of Performant Financial i.e., Performant Financial and CBIZ go up and down completely randomly.
Pair Corralation between Performant Financial and CBIZ
Given the investment horizon of 90 days Performant Financial is expected to under-perform the CBIZ. In addition to that, Performant Financial is 1.99 times more volatile than CBIZ Inc. It trades about -0.18 of its total potential returns per unit of risk. CBIZ Inc is currently generating about 0.43 per unit of volatility. If you would invest 6,686 in CBIZ Inc on August 28, 2024 and sell it today you would earn a total of 1,515 from holding CBIZ Inc or generate 22.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Performant Financial vs. CBIZ Inc
Performance |
| Timeline |
| Performant Financial |
| CBIZ Inc |
Performant Financial and CBIZ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performant Financial and CBIZ
The main advantage of trading using opposite Performant Financial and CBIZ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performant Financial position performs unexpectedly, CBIZ 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 CBIZ will offset losses from the drop in CBIZ's long position.| Performant Financial vs. Network 1 Technologies | Performant Financial vs. Rentokil Initial PLC | Performant Financial vs. Wilhelmina | Performant Financial vs. Mader Group Limited |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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