Correlation Between Palomar Holdings and Bausch
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By analyzing existing cross correlation between Palomar Holdings and Bausch Health Companies, you can compare the effects of market volatilities on Palomar Holdings and Bausch 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 Palomar Holdings with a short position of Bausch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palomar Holdings and Bausch.
Diversification Opportunities for Palomar Holdings and Bausch
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Palomar and Bausch is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Palomar Holdings and Bausch Health Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bausch Health Companies and Palomar Holdings 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 Palomar Holdings are associated (or correlated) with Bausch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bausch Health Companies has no effect on the direction of Palomar Holdings i.e., Palomar Holdings and Bausch go up and down completely randomly.
Pair Corralation between Palomar Holdings and Bausch
Given the investment horizon of 90 days Palomar Holdings is expected to generate 0.38 times more return on investment than Bausch. However, Palomar Holdings is 2.65 times less risky than Bausch. It trades about 0.16 of its potential returns per unit of risk. Bausch Health Companies is currently generating about -0.17 per unit of risk. If you would invest 8,847 in Palomar Holdings on November 2, 2024 and sell it today you would earn a total of 1,897 from holding Palomar Holdings or generate 21.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 56.67% |
| Values | Daily Returns |
Palomar Holdings vs. Bausch Health Companies
Performance |
| Timeline |
| Palomar Holdings |
| Bausch Health Companies |
Palomar Holdings and Bausch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Palomar Holdings and Bausch
The main advantage of trading using opposite Palomar Holdings and Bausch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Palomar Holdings position performs unexpectedly, Bausch 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 Bausch will offset losses from the drop in Bausch's long position.| Palomar Holdings vs. Horace Mann Educators | Palomar Holdings vs. Kemper | Palomar Holdings vs. RLI Corp | Palomar Holdings vs. Global Indemnity PLC |
| Bausch vs. Spyre Therapeutics | Bausch vs. Alvotech | Bausch vs. Aperture Health | Bausch vs. Village Super Market |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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