Correlation Between Mammoth Energy and National Health
Can any of the company-specific risk be diversified away by investing in both Mammoth Energy and National Health 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 Mammoth Energy and National Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mammoth Energy Services and National Health Scan, you can compare the effects of market volatilities on Mammoth Energy and National Health 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 Mammoth Energy with a short position of National Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mammoth Energy and National Health.
Diversification Opportunities for Mammoth Energy and National Health
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mammoth and National is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Mammoth Energy Services and National Health Scan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Health Scan and Mammoth Energy 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 Mammoth Energy Services are associated (or correlated) with National Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Health Scan has no effect on the direction of Mammoth Energy i.e., Mammoth Energy and National Health go up and down completely randomly.
Pair Corralation between Mammoth Energy and National Health
Given the investment horizon of 90 days Mammoth Energy Services is expected to under-perform the National Health. But the stock apears to be less risky and, when comparing its historical volatility, Mammoth Energy Services is 4.6 times less risky than National Health. The stock trades about -0.02 of its potential returns per unit of risk. The National Health Scan is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1.60 in National Health Scan on September 1, 2024 and sell it today you would earn a total of 0.70 from holding National Health Scan or generate 43.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mammoth Energy Services vs. National Health Scan
Performance |
| Timeline |
| Mammoth Energy Services |
| National Health Scan |
Mammoth Energy and National Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mammoth Energy and National Health
The main advantage of trading using opposite Mammoth Energy and National Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mammoth Energy position performs unexpectedly, National Health 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 Health will offset losses from the drop in National Health's long position.| Mammoth Energy vs. Matthews International | Mammoth Energy vs. Griffon | Mammoth Energy vs. Steel Partners Holdings | Mammoth Energy vs. Compass Diversified Holdings |
| National Health vs. Emergent Health Corp | National Health vs. One World Universe | National Health vs. Nextmart | National Health vs. HeadsUp Entertainment International |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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