Correlation Between Dentsply Sirona and Cigna Corp
Can any of the company-specific risk be diversified away by investing in both Dentsply Sirona and Cigna Corp 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 Dentsply Sirona and Cigna Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dentsply Sirona and Cigna Corp, you can compare the effects of market volatilities on Dentsply Sirona and Cigna Corp 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 Dentsply Sirona with a short position of Cigna Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dentsply Sirona and Cigna Corp.
Diversification Opportunities for Dentsply Sirona and Cigna Corp
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dentsply and Cigna is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Dentsply Sirona and Cigna Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cigna Corp and Dentsply Sirona 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 Dentsply Sirona are associated (or correlated) with Cigna Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cigna Corp has no effect on the direction of Dentsply Sirona i.e., Dentsply Sirona and Cigna Corp go up and down completely randomly.
Pair Corralation between Dentsply Sirona and Cigna Corp
Given the investment horizon of 90 days Dentsply Sirona is expected to generate 0.71 times more return on investment than Cigna Corp. However, Dentsply Sirona is 1.41 times less risky than Cigna Corp. It trades about 0.0 of its potential returns per unit of risk. Cigna Corp is currently generating about -0.32 per unit of risk. If you would invest 1,877 in Dentsply Sirona on September 23, 2024 and sell it today you would lose (7.00) from holding Dentsply Sirona or give up 0.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dentsply Sirona vs. Cigna Corp
Performance |
| Timeline |
| Dentsply Sirona |
| Cigna Corp |
Dentsply Sirona and Cigna Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dentsply Sirona and Cigna Corp
The main advantage of trading using opposite Dentsply Sirona and Cigna Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dentsply Sirona position performs unexpectedly, Cigna Corp 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 Cigna Corp will offset losses from the drop in Cigna Corp's long position.| Dentsply Sirona vs. Cigna Corp | Dentsply Sirona vs. Definitive Healthcare Corp | Dentsply Sirona vs. Guardant Health | Dentsply Sirona vs. Laboratory of |
| Cigna Corp vs. Definitive Healthcare Corp | Cigna Corp vs. Edwards Lifesciences Corp | Cigna Corp vs. Guardant Health | Cigna Corp vs. Mednax Inc |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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