Correlation Between Regis Healthcare and Sequoia Financial
Can any of the company-specific risk be diversified away by investing in both Regis Healthcare and Sequoia 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 Sequoia 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 Sequoia Financial Group, you can compare the effects of market volatilities on Regis Healthcare and Sequoia 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 Sequoia Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regis Healthcare and Sequoia Financial.
Diversification Opportunities for Regis Healthcare and Sequoia Financial
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Regis and Sequoia is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Regis Healthcare and Sequoia Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sequoia 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 Sequoia Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sequoia Financial has no effect on the direction of Regis Healthcare i.e., Regis Healthcare and Sequoia Financial go up and down completely randomly.
Pair Corralation between Regis Healthcare and Sequoia Financial
Assuming the 90 days trading horizon Regis Healthcare is expected to generate 2.78 times less return on investment than Sequoia Financial. But when comparing it to its historical volatility, Regis Healthcare is 1.01 times less risky than Sequoia Financial. It trades about 0.11 of its potential returns per unit of risk. Sequoia Financial Group is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 39.00 in Sequoia Financial Group on November 7, 2024 and sell it today you would earn a total of 5.00 from holding Sequoia Financial Group or generate 12.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Regis Healthcare vs. Sequoia Financial Group
Performance |
| Timeline |
| Regis Healthcare |
| Sequoia Financial |
Regis Healthcare and Sequoia Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regis Healthcare and Sequoia Financial
The main advantage of trading using opposite Regis Healthcare and Sequoia Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regis Healthcare position performs unexpectedly, Sequoia 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 Sequoia Financial will offset losses from the drop in Sequoia Financial's long position.| Regis Healthcare vs. Black Rock Mining | Regis Healthcare vs. Beam Communications Holdings | Regis Healthcare vs. Aurelia Metals | Regis Healthcare vs. Viva Leisure |
| Sequoia Financial vs. Aurelia Metals | Sequoia Financial vs. Bisalloy Steel Group | Sequoia Financial vs. Tombador Iron | Sequoia Financial vs. Red Hill Iron |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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