Correlation Between Paycor HCM and CoreCivic
Can any of the company-specific risk be diversified away by investing in both Paycor HCM and CoreCivic 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 Paycor HCM and CoreCivic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Paycor HCM and CoreCivic, you can compare the effects of market volatilities on Paycor HCM and CoreCivic 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 Paycor HCM with a short position of CoreCivic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Paycor HCM and CoreCivic.
Diversification Opportunities for Paycor HCM and CoreCivic
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Paycor and CoreCivic is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Paycor HCM and CoreCivic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoreCivic and Paycor HCM 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 Paycor HCM are associated (or correlated) with CoreCivic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoreCivic has no effect on the direction of Paycor HCM i.e., Paycor HCM and CoreCivic go up and down completely randomly.
Pair Corralation between Paycor HCM and CoreCivic
Given the investment horizon of 90 days Paycor HCM is expected to generate 10.8 times less return on investment than CoreCivic. But when comparing it to its historical volatility, Paycor HCM is 13.64 times less risky than CoreCivic. It trades about 0.18 of its potential returns per unit of risk. CoreCivic is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,883 in CoreCivic on January 15, 2025 and sell it today you would earn a total of 268.00 from holding CoreCivic or generate 14.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Paycor HCM vs. CoreCivic
Performance |
| Timeline |
| Paycor HCM |
| CoreCivic |
Paycor HCM and CoreCivic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Paycor HCM and CoreCivic
The main advantage of trading using opposite Paycor HCM and CoreCivic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Paycor HCM position performs unexpectedly, CoreCivic 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 CoreCivic will offset losses from the drop in CoreCivic's long position.| Paycor HCM vs. Manhattan Associates | Paycor HCM vs. Paycom Soft | Paycor HCM vs. Clearwater Analytics Holdings | Paycor HCM vs. Procore Technologies |
| CoreCivic vs. ADT Inc | CoreCivic vs. NL Industries | CoreCivic vs. Mistras Group | CoreCivic vs. Evolv Technologies Holdings |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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