Correlation Between Tabula Rasa and National Research
Can any of the company-specific risk be diversified away by investing in both Tabula Rasa and National Research 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 Tabula Rasa and National Research into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tabula Rasa HealthCare and National Research Corp, you can compare the effects of market volatilities on Tabula Rasa and National Research 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 Tabula Rasa with a short position of National Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tabula Rasa and National Research.
Diversification Opportunities for Tabula Rasa and National Research
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tabula and National is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Tabula Rasa HealthCare and National Research Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Research Corp and Tabula Rasa 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 Tabula Rasa HealthCare are associated (or correlated) with National Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Research Corp has no effect on the direction of Tabula Rasa i.e., Tabula Rasa and National Research go up and down completely randomly.
Pair Corralation between Tabula Rasa and National Research
Given the investment horizon of 90 days Tabula Rasa HealthCare is expected to generate 1.78 times more return on investment than National Research. However, Tabula Rasa is 1.78 times more volatile than National Research Corp. It trades about 0.12 of its potential returns per unit of risk. National Research Corp is currently generating about -0.05 per unit of risk. If you would invest 478.00 in Tabula Rasa HealthCare on August 28, 2024 and sell it today you would earn a total of 338.00 from holding Tabula Rasa HealthCare or generate 70.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 28.78% |
| Values | Daily Returns |
Tabula Rasa HealthCare vs. National Research Corp
Performance |
| Timeline |
| Tabula Rasa HealthCare |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| National Research Corp |
Tabula Rasa and National Research Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tabula Rasa and National Research
The main advantage of trading using opposite Tabula Rasa and National Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tabula Rasa position performs unexpectedly, National Research 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 National Research will offset losses from the drop in National Research's long position.| Tabula Rasa vs. Streamline Health Solutions | Tabula Rasa vs. HealthStream | Tabula Rasa vs. National Research Corp | Tabula Rasa vs. Forian Inc |
| National Research vs. Omega Flex | National Research vs. NI Holdings | National Research vs. PC Connection | National Research vs. Northrim BanCorp |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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