Correlation Between United Natural and Acadia Healthcare
Can any of the company-specific risk be diversified away by investing in both United Natural and Acadia Healthcare 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 United Natural and Acadia Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Natural Foods and Acadia Healthcare, you can compare the effects of market volatilities on United Natural and Acadia Healthcare 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 United Natural with a short position of Acadia Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Natural and Acadia Healthcare.
Diversification Opportunities for United Natural and Acadia Healthcare
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between United and Acadia is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding United Natural Foods and Acadia Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadia Healthcare and United Natural 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 United Natural Foods are associated (or correlated) with Acadia Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadia Healthcare has no effect on the direction of United Natural i.e., United Natural and Acadia Healthcare go up and down completely randomly.
Pair Corralation between United Natural and Acadia Healthcare
Assuming the 90 days horizon United Natural Foods is expected to generate 1.66 times more return on investment than Acadia Healthcare. However, United Natural is 1.66 times more volatile than Acadia Healthcare. It trades about 0.01 of its potential returns per unit of risk. Acadia Healthcare is currently generating about -0.03 per unit of risk. If you would invest 3,551 in United Natural Foods on October 11, 2024 and sell it today you would lose (902.00) from holding United Natural Foods or give up 25.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
United Natural Foods vs. Acadia Healthcare
Performance |
| Timeline |
| United Natural Foods |
| Acadia Healthcare |
United Natural and Acadia Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Natural and Acadia Healthcare
The main advantage of trading using opposite United Natural and Acadia Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Natural position performs unexpectedly, Acadia Healthcare 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 Acadia Healthcare will offset losses from the drop in Acadia Healthcare's long position.| United Natural vs. US Foods Holding | United Natural vs. Axfood AB | United Natural vs. Superior Plus Corp | United Natural vs. NMI Holdings |
| Acadia Healthcare vs. BC IRON | Acadia Healthcare vs. Monument Mining Limited | Acadia Healthcare vs. Dentsply Sirona | Acadia Healthcare vs. Nippon Steel |
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.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |