Correlation Between Regis Healthcare and Brambles
Can any of the company-specific risk be diversified away by investing in both Regis Healthcare and Brambles 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 Regis Healthcare and Brambles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regis Healthcare and Brambles, you can compare the effects of market volatilities on Regis Healthcare and Brambles 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 Regis Healthcare with a short position of Brambles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regis Healthcare and Brambles.
Diversification Opportunities for Regis Healthcare and Brambles
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Regis and Brambles is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Regis Healthcare and Brambles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brambles and Regis Healthcare 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 Regis Healthcare are associated (or correlated) with Brambles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brambles has no effect on the direction of Regis Healthcare i.e., Regis Healthcare and Brambles go up and down completely randomly.
Pair Corralation between Regis Healthcare and Brambles
Assuming the 90 days trading horizon Regis Healthcare is expected to generate 1.42 times more return on investment than Brambles. However, Regis Healthcare is 1.42 times more volatile than Brambles. It trades about 0.17 of its potential returns per unit of risk. Brambles is currently generating about 0.12 per unit of risk. If you would invest 291.00 in Regis Healthcare on September 2, 2024 and sell it today you would earn a total of 377.00 from holding Regis Healthcare or generate 129.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regis Healthcare vs. Brambles
Performance |
| Timeline |
| Regis Healthcare |
| Brambles |
Regis Healthcare and Brambles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regis Healthcare and Brambles
The main advantage of trading using opposite Regis Healthcare and Brambles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regis Healthcare position performs unexpectedly, Brambles 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 Brambles will offset losses from the drop in Brambles' long position.| Regis Healthcare vs. Westpac Banking | Regis Healthcare vs. iShares Global Healthcare | Regis Healthcare vs. Australian Dairy Farms | Regis Healthcare vs. Adriatic Metals Plc |
| Brambles vs. Energy Resources | Brambles vs. 88 Energy | Brambles vs. Amani Gold | Brambles vs. A1 Investments Resources |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| CEOs Directory Screen CEOs from public companies around the world |