Correlation Between Regis Healthcare and Insignia Financial
Can any of the company-specific risk be diversified away by investing in both Regis Healthcare and Insignia Financial 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 Insignia Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regis Healthcare and Insignia Financial, you can compare the effects of market volatilities on Regis Healthcare and Insignia Financial 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 Insignia Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regis Healthcare and Insignia Financial.
Diversification Opportunities for Regis Healthcare and Insignia Financial
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Regis and Insignia is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Regis Healthcare and Insignia Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insignia Financial 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 Insignia Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insignia Financial has no effect on the direction of Regis Healthcare i.e., Regis Healthcare and Insignia Financial go up and down completely randomly.
Pair Corralation between Regis Healthcare and Insignia Financial
Assuming the 90 days trading horizon Regis Healthcare is expected to generate 15.63 times less return on investment than Insignia Financial. But when comparing it to its historical volatility, Regis Healthcare is 1.55 times less risky than Insignia Financial. It trades about 0.03 of its potential returns per unit of risk. Insignia Financial is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 358.00 in Insignia Financial on October 24, 2024 and sell it today you would earn a total of 87.00 from holding Insignia Financial or generate 24.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regis Healthcare vs. Insignia Financial
Performance |
| Timeline |
| Regis Healthcare |
| Insignia Financial |
Regis Healthcare and Insignia Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regis Healthcare and Insignia Financial
The main advantage of trading using opposite Regis Healthcare and Insignia Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regis Healthcare position performs unexpectedly, Insignia Financial 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 Insignia Financial will offset losses from the drop in Insignia Financial's long position.| Regis Healthcare vs. Insignia Financial | Regis Healthcare vs. Bell Financial Group | Regis Healthcare vs. Talisman Mining | Regis Healthcare vs. Auswide Bank |
| Insignia Financial vs. Argo Investments | Insignia Financial vs. Hutchison Telecommunications | Insignia Financial vs. Sandon Capital Investments | Insignia Financial vs. Truscott Mining Corp |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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