Correlation Between Wheaton Precious and Bellevue Healthcare
Can any of the company-specific risk be diversified away by investing in both Wheaton Precious and Bellevue 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 Wheaton Precious and Bellevue Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wheaton Precious Metals and Bellevue Healthcare Trust, you can compare the effects of market volatilities on Wheaton Precious and Bellevue 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 Wheaton Precious with a short position of Bellevue Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wheaton Precious and Bellevue Healthcare.
Diversification Opportunities for Wheaton Precious and Bellevue Healthcare
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Wheaton and Bellevue is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Wheaton Precious Metals and Bellevue Healthcare Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bellevue Healthcare Trust and Wheaton Precious 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 Wheaton Precious Metals are associated (or correlated) with Bellevue Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bellevue Healthcare Trust has no effect on the direction of Wheaton Precious i.e., Wheaton Precious and Bellevue Healthcare go up and down completely randomly.
Pair Corralation between Wheaton Precious and Bellevue Healthcare
Assuming the 90 days trading horizon Wheaton Precious Metals is expected to generate 1.25 times more return on investment than Bellevue Healthcare. However, Wheaton Precious is 1.25 times more volatile than Bellevue Healthcare Trust. It trades about 0.14 of its potential returns per unit of risk. Bellevue Healthcare Trust is currently generating about -0.01 per unit of risk. If you would invest 474,480 in Wheaton Precious Metals on September 12, 2024 and sell it today you would earn a total of 25,520 from holding Wheaton Precious Metals or generate 5.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Wheaton Precious Metals vs. Bellevue Healthcare Trust
Performance |
| Timeline |
| Wheaton Precious Metals |
| Bellevue Healthcare Trust |
Wheaton Precious and Bellevue Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wheaton Precious and Bellevue Healthcare
The main advantage of trading using opposite Wheaton Precious and Bellevue Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wheaton Precious position performs unexpectedly, Bellevue 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 Bellevue Healthcare will offset losses from the drop in Bellevue Healthcare's long position.| Wheaton Precious vs. Givaudan SA | Wheaton Precious vs. Antofagasta PLC | Wheaton Precious vs. Ferrexpo PLC | Wheaton Precious vs. Atalaya Mining |
| Bellevue Healthcare vs. Samsung Electronics Co | Bellevue Healthcare vs. Samsung Electronics Co | Bellevue Healthcare vs. Hyundai Motor | Bellevue Healthcare vs. Toyota Motor Corp |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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