Correlation Between CVS HEALTH and Bridgemarq Real

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

By analyzing existing cross correlation between CVS HEALTH CDR and Bridgemarq Real Estate, you can compare the effects of market volatilities on CVS HEALTH and Bridgemarq Real 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 CVS HEALTH with a short position of Bridgemarq Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS HEALTH and Bridgemarq Real.

Diversification Opportunities for CVS HEALTH and Bridgemarq Real

-0.37

Correlation Coefficient

CVS HEALTH  Bridgemarq Real

Very good diversification

The 3 months correlation between CVS and Bridgemarq is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding CVS HEALTH CDR and Bridgemarq Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgemarq Real Estate and CVS 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 CVS HEALTH CDR are associated (or correlated) with Bridgemarq Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgemarq Real Estate has no effect on the direction of CVS HEALTH i.e., CVS HEALTH and Bridgemarq Real go up and down completely randomly.

Pair Corralation between CVS HEALTH and Bridgemarq Real

Assuming the 90 days trading horizon CVS HEALTH CDR is expected to under-perform the Bridgemarq Real. In addition to that, CVS HEALTH is 2.32 times more volatile than Bridgemarq Real Estate. It trades about -0.18 of its total potential returns per unit of risk. Bridgemarq Real Estate is currently generating about 0.15 per unit of volatility. If you would invest  1,380  in Bridgemarq Real Estate on September 28, 2024 and sell it today you would earn a total of  155.00  from holding Bridgemarq Real Estate or generate 11.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

CVS HEALTH CDR  vs.  Bridgemarq Real Estate

CVS HEALTH CDR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CVS HEALTH CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Bridgemarq Real Estate

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bridgemarq Real Estate are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Bridgemarq Real may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with CVS HEALTH and Bridgemarq Real

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

The idea behind CVS HEALTH CDR and Bridgemarq Real Estate 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.

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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.