Correlation Between Regis Healthcare and Credit Clear
Can any of the company-specific risk be diversified away by investing in both Regis Healthcare and Credit Clear 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 Credit Clear into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regis Healthcare and Credit Clear, you can compare the effects of market volatilities on Regis Healthcare and Credit Clear 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 Credit Clear. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regis Healthcare and Credit Clear.
Diversification Opportunities for Regis Healthcare and Credit Clear
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Regis and Credit is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Regis Healthcare and Credit Clear in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Clear 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 Credit Clear. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Clear has no effect on the direction of Regis Healthcare i.e., Regis Healthcare and Credit Clear go up and down completely randomly.
Pair Corralation between Regis Healthcare and Credit Clear
Assuming the 90 days trading horizon Regis Healthcare is expected to generate 0.54 times more return on investment than Credit Clear. However, Regis Healthcare is 1.84 times less risky than Credit Clear. It trades about 0.13 of its potential returns per unit of risk. Credit Clear is currently generating about 0.01 per unit of risk. If you would invest 186.00 in Regis Healthcare on September 3, 2024 and sell it today you would earn a total of 482.00 from holding Regis Healthcare or generate 259.14% 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. Credit Clear
Performance |
| Timeline |
| Regis Healthcare |
| Credit Clear |
Regis Healthcare and Credit Clear Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regis Healthcare and Credit Clear
The main advantage of trading using opposite Regis Healthcare and Credit Clear positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regis Healthcare position performs unexpectedly, Credit Clear 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 Credit Clear will offset losses from the drop in Credit Clear's long position.| Regis Healthcare vs. Rio Tinto | Regis Healthcare vs. Commonwealth Bank of | Regis Healthcare vs. Commonwealth Bank of | Regis Healthcare vs. Champion Iron |
| Credit Clear vs. Commonwealth Bank | Credit Clear vs. Commonwealth Bank of | Credit Clear vs. Champion Iron | Credit Clear vs. iShares Global Healthcare |
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.
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