Correlation Between Sonida Senior and Planet Image
Can any of the company-specific risk be diversified away by investing in both Sonida Senior and Planet Image 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 Sonida Senior and Planet Image into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sonida Senior Living and Planet Image International, you can compare the effects of market volatilities on Sonida Senior and Planet Image 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 Sonida Senior with a short position of Planet Image. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonida Senior and Planet Image.
Diversification Opportunities for Sonida Senior and Planet Image
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sonida and Planet is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Sonida Senior Living and Planet Image International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Image Interna and Sonida Senior 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 Sonida Senior Living are associated (or correlated) with Planet Image. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Image Interna has no effect on the direction of Sonida Senior i.e., Sonida Senior and Planet Image go up and down completely randomly.
Pair Corralation between Sonida Senior and Planet Image
Given the investment horizon of 90 days Sonida Senior Living is expected to generate 0.61 times more return on investment than Planet Image. However, Sonida Senior Living is 1.65 times less risky than Planet Image. It trades about 0.1 of its potential returns per unit of risk. Planet Image International is currently generating about 0.06 per unit of risk. If you would invest 970.00 in Sonida Senior Living on September 12, 2024 and sell it today you would earn a total of 1,540 from holding Sonida Senior Living or generate 158.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 89.92% |
| Values | Daily Returns |
Sonida Senior Living vs. Planet Image International
Performance |
| Timeline |
| Sonida Senior Living |
| Planet Image Interna |
Sonida Senior and Planet Image Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sonida Senior and Planet Image
The main advantage of trading using opposite Sonida Senior and Planet Image positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonida Senior position performs unexpectedly, Planet Image 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 Planet Image will offset losses from the drop in Planet Image's long position.| Sonida Senior vs. Select Medical Holdings | Sonida Senior vs. Encompass Health Corp | Sonida Senior vs. Pennant Group | Sonida Senior vs. InnovAge Holding Corp |
| Planet Image vs. ServiceNow | Planet Image vs. Red Branch Technologies | Planet Image vs. AMCON Distributing | Planet Image vs. Evertz Technologies Limited |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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