Correlation Between Sabra Healthcare and Hertz Global
Can any of the company-specific risk be diversified away by investing in both Sabra Healthcare and Hertz Global 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 Sabra Healthcare and Hertz Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Healthcare REIT and Hertz Global Holdings, you can compare the effects of market volatilities on Sabra Healthcare and Hertz Global 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 Sabra Healthcare with a short position of Hertz Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Healthcare and Hertz Global.
Diversification Opportunities for Sabra Healthcare and Hertz Global
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sabra and Hertz is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Healthcare REIT and Hertz Global Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hertz Global Holdings and Sabra 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 Sabra Healthcare REIT are associated (or correlated) with Hertz Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hertz Global Holdings has no effect on the direction of Sabra Healthcare i.e., Sabra Healthcare and Hertz Global go up and down completely randomly.
Pair Corralation between Sabra Healthcare and Hertz Global
Given the investment horizon of 90 days Sabra Healthcare REIT is expected to under-perform the Hertz Global. But the stock apears to be less risky and, when comparing its historical volatility, Sabra Healthcare REIT is 2.77 times less risky than Hertz Global. The stock trades about -0.02 of its potential returns per unit of risk. The Hertz Global Holdings is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 306.00 in Hertz Global Holdings on August 28, 2024 and sell it today you would earn a total of 152.00 from holding Hertz Global Holdings or generate 49.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabra Healthcare REIT vs. Hertz Global Holdings
Performance |
| Timeline |
| Sabra Healthcare REIT |
| Hertz Global Holdings |
Sabra Healthcare and Hertz Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabra Healthcare and Hertz Global
The main advantage of trading using opposite Sabra Healthcare and Hertz Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Healthcare position performs unexpectedly, Hertz Global 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 Hertz Global will offset losses from the drop in Hertz Global's long position.| Sabra Healthcare vs. Healthcare Realty Trust | Sabra Healthcare vs. Healthpeak Properties | Sabra Healthcare vs. Community Healthcare Trust | Sabra Healthcare vs. Universal Health Realty |
| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Hertz Global Hldgs |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |