Correlation Between Scientific Games and ADDUS HOMECARE
Can any of the company-specific risk be diversified away by investing in both Scientific Games and ADDUS HOMECARE 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 Scientific Games and ADDUS HOMECARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scientific Games and ADDUS HOMECARE, you can compare the effects of market volatilities on Scientific Games and ADDUS HOMECARE 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 Scientific Games with a short position of ADDUS HOMECARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scientific Games and ADDUS HOMECARE.
Diversification Opportunities for Scientific Games and ADDUS HOMECARE
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Scientific and ADDUS is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Scientific Games and ADDUS HOMECARE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADDUS HOMECARE and Scientific Games 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 Scientific Games are associated (or correlated) with ADDUS HOMECARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADDUS HOMECARE has no effect on the direction of Scientific Games i.e., Scientific Games and ADDUS HOMECARE go up and down completely randomly.
Pair Corralation between Scientific Games and ADDUS HOMECARE
Assuming the 90 days horizon Scientific Games is expected to under-perform the ADDUS HOMECARE. In addition to that, Scientific Games is 1.03 times more volatile than ADDUS HOMECARE. It trades about -0.38 of its total potential returns per unit of risk. ADDUS HOMECARE is currently generating about 0.26 per unit of volatility. If you would invest 11,400 in ADDUS HOMECARE on October 10, 2024 and sell it today you would earn a total of 800.00 from holding ADDUS HOMECARE or generate 7.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scientific Games vs. ADDUS HOMECARE
Performance |
| Timeline |
| Scientific Games |
| ADDUS HOMECARE |
Scientific Games and ADDUS HOMECARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scientific Games and ADDUS HOMECARE
The main advantage of trading using opposite Scientific Games and ADDUS HOMECARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scientific Games position performs unexpectedly, ADDUS HOMECARE 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 ADDUS HOMECARE will offset losses from the drop in ADDUS HOMECARE's long position.| Scientific Games vs. ELMOS SEMICONDUCTOR | Scientific Games vs. BE Semiconductor Industries | Scientific Games vs. Solstad Offshore ASA | Scientific Games vs. NXP Semiconductors NV |
| ADDUS HOMECARE vs. Ribbon Communications | ADDUS HOMECARE vs. WIZZ AIR HLDGUNSPADR4 | ADDUS HOMECARE vs. Cairo Communication SpA | ADDUS HOMECARE vs. Chunghwa Telecom Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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