Correlation Between Invesco Health and Intermediate Capital
Can any of the company-specific risk be diversified away by investing in both Invesco Health and Intermediate Capital 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 Invesco Health and Intermediate Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Health Care and Intermediate Capital Group, you can compare the effects of market volatilities on Invesco Health and Intermediate Capital 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 Invesco Health with a short position of Intermediate Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Health and Intermediate Capital.
Diversification Opportunities for Invesco Health and Intermediate Capital
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Invesco and Intermediate is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Health Care and Intermediate Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Capital and Invesco 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 Invesco Health Care are associated (or correlated) with Intermediate Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Capital has no effect on the direction of Invesco Health i.e., Invesco Health and Intermediate Capital go up and down completely randomly.
Pair Corralation between Invesco Health and Intermediate Capital
Assuming the 90 days trading horizon Invesco Health is expected to generate 3.2 times less return on investment than Intermediate Capital. But when comparing it to its historical volatility, Invesco Health Care is 2.67 times less risky than Intermediate Capital. It trades about 0.09 of its potential returns per unit of risk. Intermediate Capital Group is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 125,017 in Intermediate Capital Group on August 25, 2024 and sell it today you would earn a total of 84,383 from holding Intermediate Capital Group or generate 67.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Invesco Health Care vs. Intermediate Capital Group
Performance |
Timeline |
Invesco Health Care |
Intermediate Capital |
Invesco Health and Intermediate Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Invesco Health and Intermediate Capital
The main advantage of trading using opposite Invesco Health and Intermediate Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Health position performs unexpectedly, Intermediate Capital 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 Intermediate Capital will offset losses from the drop in Intermediate Capital's long position.Invesco Health vs. Invesco MSCI Emerging | Invesco Health vs. Invesco EURO STOXX | Invesco Health vs. Invesco Markets Plc | Invesco Health vs. Invesco FTSE RAFI |
Intermediate Capital vs. Catalyst Media Group | Intermediate Capital vs. Oncimmune Holdings plc | Intermediate Capital vs. Invesco Health Care | Intermediate Capital vs. Coor Service Management |
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.
Other Complementary Tools
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |