Correlation Between National Health and BRAGG GAMING
Can any of the company-specific risk be diversified away by investing in both National Health and BRAGG GAMING 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 National Health and BRAGG GAMING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Health Investors and BRAGG GAMING GRP, you can compare the effects of market volatilities on National Health and BRAGG GAMING 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 National Health with a short position of BRAGG GAMING. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Health and BRAGG GAMING.
Diversification Opportunities for National Health and BRAGG GAMING
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between National and BRAGG is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding National Health Investors and BRAGG GAMING GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BRAGG GAMING GRP and National 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 National Health Investors are associated (or correlated) with BRAGG GAMING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BRAGG GAMING GRP has no effect on the direction of National Health i.e., National Health and BRAGG GAMING go up and down completely randomly.
Pair Corralation between National Health and BRAGG GAMING
Assuming the 90 days trading horizon National Health Investors is expected to under-perform the BRAGG GAMING. But the stock apears to be less risky and, when comparing its historical volatility, National Health Investors is 4.34 times less risky than BRAGG GAMING. The stock trades about -0.51 of its potential returns per unit of risk. The BRAGG GAMING GRP is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 308.00 in BRAGG GAMING GRP on September 22, 2024 and sell it today you would earn a total of 28.00 from holding BRAGG GAMING GRP or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Health Investors vs. BRAGG GAMING GRP
Performance |
| Timeline |
| National Health Investors |
| BRAGG GAMING GRP |
National Health and BRAGG GAMING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Health and BRAGG GAMING
The main advantage of trading using opposite National Health and BRAGG GAMING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Health position performs unexpectedly, BRAGG GAMING 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 BRAGG GAMING will offset losses from the drop in BRAGG GAMING's long position.| National Health vs. Schweizer Electronic AG | National Health vs. SIDETRADE EO 1 | National Health vs. ARROW ELECTRONICS | National Health vs. American Eagle Outfitters |
| BRAGG GAMING vs. Plastic Omnium | BRAGG GAMING vs. National Health Investors | BRAGG GAMING vs. Rayonier Advanced Materials | BRAGG GAMING vs. SANOK RUBBER ZY |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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