Correlation Between SunLink Health and Legato Merger
Can any of the company-specific risk be diversified away by investing in both SunLink Health and Legato Merger 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 Legato Merger 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 Legato Merger II, you can compare the effects of market volatilities on SunLink Health and Legato Merger 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 Legato Merger. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunLink Health and Legato Merger.
Diversification Opportunities for SunLink Health and Legato Merger
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between SunLink and Legato is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding SunLink Health Systems and Legato Merger II in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Legato Merger II 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 Legato Merger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Legato Merger II has no effect on the direction of SunLink Health i.e., SunLink Health and Legato Merger go up and down completely randomly.
Pair Corralation between SunLink Health and Legato Merger
Considering the 90-day investment horizon SunLink Health Systems is expected to under-perform the Legato Merger. In addition to that, SunLink Health is 1.71 times more volatile than Legato Merger II. It trades about 0.0 of its total potential returns per unit of risk. Legato Merger II is currently generating about 0.29 per unit of volatility. If you would invest 291.00 in Legato Merger II on September 15, 2024 and sell it today you would earn a total of 55.00 from holding Legato Merger II or generate 18.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunLink Health Systems vs. Legato Merger II
Performance |
| Timeline |
| SunLink Health Systems |
| Legato Merger II |
SunLink Health and Legato Merger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunLink Health and Legato Merger
The main advantage of trading using opposite SunLink Health and Legato Merger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunLink Health position performs unexpectedly, Legato Merger 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 Legato Merger will offset losses from the drop in Legato Merger's long position.| SunLink Health vs. ASGN Inc | SunLink Health vs. Kforce Inc | SunLink Health vs. Kelly Services A | SunLink Health vs. AMN Healthcare Services |
| Legato Merger vs. Western Acquisition Ventures | Legato Merger vs. JD Sports Fashion | Legato Merger vs. Sandstorm Gold Ltd | Legato Merger vs. Verra Mobility Corp |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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