Correlation Between Streamline Health and CareCloud
Can any of the company-specific risk be diversified away by investing in both Streamline Health and CareCloud 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 Streamline Health and CareCloud into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Streamline Health Solutions and CareCloud, you can compare the effects of market volatilities on Streamline Health and CareCloud 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 Streamline Health with a short position of CareCloud. Check out your portfolio center. Please also check ongoing floating volatility patterns of Streamline Health and CareCloud.
Diversification Opportunities for Streamline Health and CareCloud
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Streamline and CareCloud is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Streamline Health Solutions and CareCloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareCloud and Streamline 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 Streamline Health Solutions are associated (or correlated) with CareCloud. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareCloud has no effect on the direction of Streamline Health i.e., Streamline Health and CareCloud go up and down completely randomly.
Pair Corralation between Streamline Health and CareCloud
Given the investment horizon of 90 days Streamline Health is expected to generate 3.18 times less return on investment than CareCloud. But when comparing it to its historical volatility, Streamline Health Solutions is 1.04 times less risky than CareCloud. It trades about 0.03 of its potential returns per unit of risk. CareCloud is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 104.00 in CareCloud on August 24, 2024 and sell it today you would earn a total of 181.00 from holding CareCloud or generate 174.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Streamline Health Solutions vs. CareCloud
Performance |
| Timeline |
| Streamline Health |
| CareCloud |
Streamline Health and CareCloud Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Streamline Health and CareCloud
The main advantage of trading using opposite Streamline Health and CareCloud positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Streamline Health position performs unexpectedly, CareCloud 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 CareCloud will offset losses from the drop in CareCloud's long position.| Streamline Health vs. HealthStream | Streamline Health vs. National Research Corp | Streamline Health vs. Forian Inc | Streamline Health vs. HealthEquity |
| CareCloud vs. Forian Inc | CareCloud vs. HealthStream | CareCloud vs. National Research Corp | CareCloud vs. Streamline Health Solutions |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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