Correlation Between Ramsay Health and AMN Healthcare
Can any of the company-specific risk be diversified away by investing in both Ramsay Health and AMN Healthcare 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 Ramsay Health and AMN Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ramsay Health Care and AMN Healthcare Services, you can compare the effects of market volatilities on Ramsay Health and AMN Healthcare 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 Ramsay Health with a short position of AMN Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramsay Health and AMN Healthcare.
Diversification Opportunities for Ramsay Health and AMN Healthcare
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ramsay and AMN is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Ramsay Health Care and AMN Healthcare Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMN Healthcare Services and Ramsay Health 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 Ramsay Health Care are associated (or correlated) with AMN Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMN Healthcare Services has no effect on the direction of Ramsay Health i.e., Ramsay Health and AMN Healthcare go up and down completely randomly.
Pair Corralation between Ramsay Health and AMN Healthcare
Assuming the 90 days horizon Ramsay Health Care is expected to under-perform the AMN Healthcare. But the pink sheet apears to be less risky and, when comparing its historical volatility, Ramsay Health Care is 1.85 times less risky than AMN Healthcare. The pink sheet trades about -0.15 of its potential returns per unit of risk. The AMN Healthcare Services is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 2,321 in AMN Healthcare Services on October 24, 2024 and sell it today you would earn a total of 389.00 from holding AMN Healthcare Services or generate 16.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Ramsay Health Care vs. AMN Healthcare Services
Performance |
| Timeline |
| Ramsay Health Care |
| AMN Healthcare Services |
Ramsay Health and AMN Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ramsay Health and AMN Healthcare
The main advantage of trading using opposite Ramsay Health and AMN Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ramsay Health position performs unexpectedly, AMN Healthcare 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 AMN Healthcare will offset losses from the drop in AMN Healthcare's long position.| Ramsay Health vs. Medical Facilities | Ramsay Health vs. Fresenius SE Co | Ramsay Health vs. Jack Nathan Medical | Ramsay Health vs. Nova Leap Health |
| AMN Healthcare vs. Option Care Health | AMN Healthcare vs. Addus HomeCare | AMN Healthcare vs. Acadia Healthcare | AMN Healthcare vs. Encompass Health 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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