Correlation Between WELL Health and WildBrain
Can any of the company-specific risk be diversified away by investing in both WELL Health and WildBrain 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 WELL Health and WildBrain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WELL Health Technologies and WildBrain, you can compare the effects of market volatilities on WELL Health and WildBrain 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 WELL Health with a short position of WildBrain. Check out your portfolio center. Please also check ongoing floating volatility patterns of WELL Health and WildBrain.
Diversification Opportunities for WELL Health and WildBrain
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WELL and WildBrain is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding WELL Health Technologies and WildBrain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WildBrain and WELL Health 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 WELL Health Technologies are associated (or correlated) with WildBrain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WildBrain has no effect on the direction of WELL Health i.e., WELL Health and WildBrain go up and down completely randomly.
Pair Corralation between WELL Health and WildBrain
Assuming the 90 days trading horizon WELL Health Technologies is expected to generate 0.73 times more return on investment than WildBrain. However, WELL Health Technologies is 1.36 times less risky than WildBrain. It trades about 0.46 of its potential returns per unit of risk. WildBrain is currently generating about 0.3 per unit of risk. If you would invest 512.00 in WELL Health Technologies on September 13, 2024 and sell it today you would earn a total of 157.00 from holding WELL Health Technologies or generate 30.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WELL Health Technologies vs. WildBrain
Performance |
| Timeline |
| WELL Health Technologies |
| WildBrain |
WELL Health and WildBrain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WELL Health and WildBrain
The main advantage of trading using opposite WELL Health and WildBrain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WELL Health position performs unexpectedly, WildBrain 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 WildBrain will offset losses from the drop in WildBrain's long position.| WELL Health vs. Extendicare | WELL Health vs. Sienna Senior Living | WELL Health vs. Rogers Sugar | WELL Health vs. Chemtrade Logistics Income |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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