Correlation Between Performant Financial and Paycor HCM
Can any of the company-specific risk be diversified away by investing in both Performant Financial and Paycor HCM 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 Paycor HCM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performant Financial and Paycor HCM, you can compare the effects of market volatilities on Performant Financial and Paycor HCM 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 Paycor HCM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performant Financial and Paycor HCM.
Diversification Opportunities for Performant Financial and Paycor HCM
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Performant and Paycor is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Performant Financial and Paycor HCM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paycor HCM 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 Paycor HCM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paycor HCM has no effect on the direction of Performant Financial i.e., Performant Financial and Paycor HCM go up and down completely randomly.
Pair Corralation between Performant Financial and Paycor HCM
Given the investment horizon of 90 days Performant Financial is expected to under-perform the Paycor HCM. In addition to that, Performant Financial is 2.25 times more volatile than Paycor HCM. It trades about -0.18 of its total potential returns per unit of risk. Paycor HCM is currently generating about 0.51 per unit of volatility. If you would invest 1,463 in Paycor HCM on August 28, 2024 and sell it today you would earn a total of 355.00 from holding Paycor HCM or generate 24.27% 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. Paycor HCM
Performance |
| Timeline |
| Performant Financial |
| Paycor HCM |
Performant Financial and Paycor HCM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performant Financial and Paycor HCM
The main advantage of trading using opposite Performant Financial and Paycor HCM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performant Financial position performs unexpectedly, Paycor HCM 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 Paycor HCM will offset losses from the drop in Paycor HCM'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 |
| Paycor HCM vs. Manhattan Associates | Paycor HCM vs. Paycom Soft | Paycor HCM vs. Clearwater Analytics Holdings | Paycor HCM vs. Procore Technologies |
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.
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