Correlation Between Pennant and DocGo
Can any of the company-specific risk be diversified away by investing in both Pennant and DocGo 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 Pennant and DocGo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pennant Group and DocGo Inc, you can compare the effects of market volatilities on Pennant and DocGo 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 Pennant with a short position of DocGo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pennant and DocGo.
Diversification Opportunities for Pennant and DocGo
Very good diversification
The 3 months correlation between Pennant and DocGo is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Pennant Group and DocGo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DocGo Inc and Pennant 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 Pennant Group are associated (or correlated) with DocGo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DocGo Inc has no effect on the direction of Pennant i.e., Pennant and DocGo go up and down completely randomly.
Pair Corralation between Pennant and DocGo
Given the investment horizon of 90 days Pennant Group is expected to generate 0.5 times more return on investment than DocGo. However, Pennant Group is 2.0 times less risky than DocGo. It trades about 0.15 of its potential returns per unit of risk. DocGo Inc is currently generating about 0.0 per unit of risk. If you would invest 1,392 in Pennant Group on August 25, 2024 and sell it today you would earn a total of 1,722 from holding Pennant Group or generate 123.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pennant Group vs. DocGo Inc
Performance |
| Timeline |
| Pennant Group |
| DocGo Inc |
Pennant and DocGo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pennant and DocGo
The main advantage of trading using opposite Pennant and DocGo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pennant position performs unexpectedly, DocGo 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 DocGo will offset losses from the drop in DocGo's long position.| Pennant vs. Encompass Health Corp | Pennant vs. Acadia Healthcare | Pennant vs. Select Medical Holdings | Pennant vs. Addus HomeCare |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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