Correlation Between Sachem Capital and Harrow Health
Can any of the company-specific risk be diversified away by investing in both Sachem Capital and Harrow Health 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 Sachem Capital and Harrow Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sachem Capital Corp and Harrow Health 8625, you can compare the effects of market volatilities on Sachem Capital and Harrow Health 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 Sachem Capital with a short position of Harrow Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sachem Capital and Harrow Health.
Diversification Opportunities for Sachem Capital and Harrow Health
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sachem and Harrow is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sachem Capital Corp and Harrow Health 8625 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harrow Health 8625 and Sachem Capital 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 Sachem Capital Corp are associated (or correlated) with Harrow Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harrow Health 8625 has no effect on the direction of Sachem Capital i.e., Sachem Capital and Harrow Health go up and down completely randomly.
Pair Corralation between Sachem Capital and Harrow Health
Assuming the 90 days trading horizon Sachem Capital is expected to generate 1.24 times less return on investment than Harrow Health. In addition to that, Sachem Capital is 2.13 times more volatile than Harrow Health 8625. It trades about 0.03 of its total potential returns per unit of risk. Harrow Health 8625 is currently generating about 0.07 per unit of volatility. If you would invest 2,020 in Harrow Health 8625 on August 24, 2024 and sell it today you would earn a total of 516.00 from holding Harrow Health 8625 or generate 25.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sachem Capital Corp vs. Harrow Health 8625
Performance |
| Timeline |
| Sachem Capital Corp |
| Harrow Health 8625 |
Sachem Capital and Harrow Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sachem Capital and Harrow Health
The main advantage of trading using opposite Sachem Capital and Harrow Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sachem Capital position performs unexpectedly, Harrow Health 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 Harrow Health will offset losses from the drop in Harrow Health's long position.| Sachem Capital vs. SiriusPoint | Sachem Capital vs. Harrow Health 8625 | Sachem Capital vs. XOMA Corporation | Sachem Capital vs. New York Mortgage |
| Harrow Health vs. Babcock Wilcox Enterprises, | Harrow Health vs. Babcock Wilcox Enterprises | Harrow Health vs. B Riley Financial | Harrow Health vs. SiriusPoint |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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