Correlation Between Spire Healthcare and Naturhouse Health
Can any of the company-specific risk be diversified away by investing in both Spire Healthcare and Naturhouse 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 Spire Healthcare and Naturhouse Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spire Healthcare Group and Naturhouse Health SA, you can compare the effects of market volatilities on Spire Healthcare and Naturhouse 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 Spire Healthcare with a short position of Naturhouse Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Healthcare and Naturhouse Health.
Diversification Opportunities for Spire Healthcare and Naturhouse Health
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Spire and Naturhouse is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Spire Healthcare Group and Naturhouse Health SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naturhouse Health and Spire 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 Spire Healthcare Group are associated (or correlated) with Naturhouse Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naturhouse Health has no effect on the direction of Spire Healthcare i.e., Spire Healthcare and Naturhouse Health go up and down completely randomly.
Pair Corralation between Spire Healthcare and Naturhouse Health
Assuming the 90 days trading horizon Spire Healthcare is expected to generate 1.13 times less return on investment than Naturhouse Health. But when comparing it to its historical volatility, Spire Healthcare Group is 1.02 times less risky than Naturhouse Health. It trades about 0.1 of its potential returns per unit of risk. Naturhouse Health SA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 167.00 in Naturhouse Health SA on November 3, 2024 and sell it today you would earn a total of 5.00 from holding Naturhouse Health SA or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spire Healthcare Group vs. Naturhouse Health SA
Performance |
| Timeline |
| Spire Healthcare |
| Naturhouse Health |
Spire Healthcare and Naturhouse Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spire Healthcare and Naturhouse Health
The main advantage of trading using opposite Spire Healthcare and Naturhouse Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spire Healthcare position performs unexpectedly, Naturhouse 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 Naturhouse Health will offset losses from the drop in Naturhouse Health's long position.| Spire Healthcare vs. Sabien Technology Group | Spire Healthcare vs. AMG Advanced Metallurgical | Spire Healthcare vs. Jacquet Metal Service | Spire Healthcare vs. Take Two Interactive Software |
| Naturhouse Health vs. United States Steel | Naturhouse Health vs. Lundin Mining Corp | Naturhouse Health vs. Symphony Environmental Technologies | Naturhouse Health vs. Iron Mountain |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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