Correlation Between CareMax and Quantum Si

Can any of the company-specific risk be diversified away by investing in both CareMax and Quantum Si 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 CareMax and Quantum Si into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CareMax and Quantum Si incorporated, you can compare the effects of market volatilities on CareMax and Quantum Si 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 CareMax with a short position of Quantum Si. Check out your portfolio center. Please also check ongoing floating volatility patterns of CareMax and Quantum Si.

Diversification Opportunities for CareMax and Quantum Si

-0.07

Correlation Coefficient

CareMax  Quantum Si

Good diversification

The 3 months correlation between CareMax and Quantum is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding CareMax and Quantum Si incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantum Si incorporated and CareMax 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 CareMax are associated (or correlated) with Quantum Si. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantum Si incorporated has no effect on the direction of CareMax i.e., CareMax and Quantum Si go up and down completely randomly.

Pair Corralation between CareMax and Quantum Si

Assuming the 90 days horizon CareMax is expected to generate 6.29 times more return on investment than Quantum Si. However, CareMax is 6.29 times more volatile than Quantum Si incorporated. It trades about 0.15 of its potential returns per unit of risk. Quantum Si incorporated is currently generating about 0.17 per unit of risk. If you would invest  1.69  in CareMax on September 3, 2024 and sell it today you would lose (0.73) from holding CareMax or give up 43.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	80.33%
Values	Daily Returns

CareMax  vs.  Quantum Si incorporated

CareMax

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CareMax are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, CareMax showed solid returns over the last few months and may actually be approaching a breakup point.

Quantum Si incorporated

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Quantum Si incorporated are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Quantum Si showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CareMax and Quantum Si

The main advantage of trading using opposite CareMax and Quantum Si positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CareMax position performs unexpectedly, Quantum Si 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 Quantum Si will offset losses from the drop in Quantum Si's long position.

The idea behind CareMax and Quantum Si incorporated pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..