Correlation Between SunLink Health and Kinsale Capital
Can any of the company-specific risk be diversified away by investing in both SunLink Health and Kinsale Capital 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 SunLink Health and Kinsale Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunLink Health Systems and Kinsale Capital Group, you can compare the effects of market volatilities on SunLink Health and Kinsale Capital 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 SunLink Health with a short position of Kinsale Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunLink Health and Kinsale Capital.
Diversification Opportunities for SunLink Health and Kinsale Capital
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SunLink and Kinsale is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding SunLink Health Systems and Kinsale Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinsale Capital Group and SunLink 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 SunLink Health Systems are associated (or correlated) with Kinsale Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinsale Capital Group has no effect on the direction of SunLink Health i.e., SunLink Health and Kinsale Capital go up and down completely randomly.
Pair Corralation between SunLink Health and Kinsale Capital
Considering the 90-day investment horizon SunLink Health is expected to generate 5.49 times less return on investment than Kinsale Capital. In addition to that, SunLink Health is 1.69 times more volatile than Kinsale Capital Group. It trades about 0.01 of its total potential returns per unit of risk. Kinsale Capital Group is currently generating about 0.08 per unit of volatility. If you would invest 32,853 in Kinsale Capital Group on September 2, 2024 and sell it today you would earn a total of 17,991 from holding Kinsale Capital Group or generate 54.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunLink Health Systems vs. Kinsale Capital Group
Performance |
| Timeline |
| SunLink Health Systems |
| Kinsale Capital Group |
SunLink Health and Kinsale Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunLink Health and Kinsale Capital
The main advantage of trading using opposite SunLink Health and Kinsale Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunLink Health position performs unexpectedly, Kinsale Capital 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 Kinsale Capital will offset losses from the drop in Kinsale Capital's long position.| SunLink Health vs. Humana Inc | SunLink Health vs. Cigna Corp | SunLink Health vs. Elevance Health | SunLink Health vs. Centene Corp |
| Kinsale Capital vs. Selective Insurance Group | Kinsale Capital vs. Horace Mann Educators | Kinsale Capital vs. Kemper | Kinsale Capital vs. ProAssurance |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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