Correlation Between Varex Imaging and Cencora
Can any of the company-specific risk be diversified away by investing in both Varex Imaging and Cencora 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 Varex Imaging and Cencora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Varex Imaging Corp and Cencora, you can compare the effects of market volatilities on Varex Imaging and Cencora 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 Varex Imaging with a short position of Cencora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Varex Imaging and Cencora.
Diversification Opportunities for Varex Imaging and Cencora
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Varex and Cencora is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Varex Imaging Corp and Cencora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cencora and Varex Imaging 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 Varex Imaging Corp are associated (or correlated) with Cencora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cencora has no effect on the direction of Varex Imaging i.e., Varex Imaging and Cencora go up and down completely randomly.
Pair Corralation between Varex Imaging and Cencora
Given the investment horizon of 90 days Varex Imaging Corp is expected to generate 1.86 times more return on investment than Cencora. However, Varex Imaging is 1.86 times more volatile than Cencora. It trades about 0.39 of its potential returns per unit of risk. Cencora is currently generating about 0.16 per unit of risk. If you would invest 1,315 in Varex Imaging Corp on August 28, 2024 and sell it today you would earn a total of 324.00 from holding Varex Imaging Corp or generate 24.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Varex Imaging Corp vs. Cencora
Performance |
| Timeline |
| Varex Imaging Corp |
| Cencora |
Varex Imaging and Cencora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Varex Imaging and Cencora
The main advantage of trading using opposite Varex Imaging and Cencora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Varex Imaging position performs unexpectedly, Cencora 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 Cencora will offset losses from the drop in Cencora's long position.| Varex Imaging vs. Sight Sciences | Varex Imaging vs. Apyx Medical | Varex Imaging vs. Si Bone | Varex Imaging vs. Iradimed Co |
| Cencora vs. Vita Coco | Cencora vs. RadNet Inc | Cencora vs. Thai Beverage PCL | Cencora vs. Compania Cervecerias Unidas |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |