Correlation Between Catheter Precision and Encompass Health
Can any of the company-specific risk be diversified away by investing in both Catheter Precision and Encompass 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 Catheter Precision and Encompass Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Catheter Precision and Encompass Health Corp, you can compare the effects of market volatilities on Catheter Precision and Encompass 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 Catheter Precision with a short position of Encompass Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Catheter Precision and Encompass Health.
Diversification Opportunities for Catheter Precision and Encompass Health
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Catheter and Encompass is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Catheter Precision and Encompass Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Encompass Health Corp and Catheter Precision 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 Catheter Precision are associated (or correlated) with Encompass Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Encompass Health Corp has no effect on the direction of Catheter Precision i.e., Catheter Precision and Encompass Health go up and down completely randomly.
Pair Corralation between Catheter Precision and Encompass Health
Given the investment horizon of 90 days Catheter Precision is expected to under-perform the Encompass Health. In addition to that, Catheter Precision is 2.51 times more volatile than Encompass Health Corp. It trades about -0.26 of its total potential returns per unit of risk. Encompass Health Corp is currently generating about 0.21 per unit of volatility. If you would invest 9,309 in Encompass Health Corp on August 27, 2024 and sell it today you would earn a total of 803.00 from holding Encompass Health Corp or generate 8.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Catheter Precision vs. Encompass Health Corp
Performance |
| Timeline |
| Catheter Precision |
| Encompass Health Corp |
Catheter Precision and Encompass Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Catheter Precision and Encompass Health
The main advantage of trading using opposite Catheter Precision and Encompass Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Catheter Precision position performs unexpectedly, Encompass 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 Encompass Health will offset losses from the drop in Encompass Health's long position.| Catheter Precision vs. Heartbeam | Catheter Precision vs. EUDA Health Holdings | Catheter Precision vs. Nutex Health | Catheter Precision vs. Healthcare Triangle |
| Encompass Health vs. Pennant Group | Encompass Health vs. The Ensign Group | Encompass Health vs. InnovAge Holding Corp | Encompass Health vs. ModivCare |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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