Correlation Between Regis Healthcare and Bisalloy Steel

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

By analyzing existing cross correlation between Regis Healthcare and Bisalloy Steel Group, you can compare the effects of market volatilities on Regis Healthcare and Bisalloy Steel 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 Regis Healthcare with a short position of Bisalloy Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regis Healthcare and Bisalloy Steel.

Diversification Opportunities for Regis Healthcare and Bisalloy Steel

0.05

Correlation Coefficient

Regis Healthcare  Bisalloy Steel

Significant diversification

The 3 months correlation between Regis and Bisalloy is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Regis Healthcare and Bisalloy Steel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bisalloy Steel Group and Regis Healthcare 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 Regis Healthcare are associated (or correlated) with Bisalloy Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bisalloy Steel Group has no effect on the direction of Regis Healthcare i.e., Regis Healthcare and Bisalloy Steel go up and down completely randomly.

Pair Corralation between Regis Healthcare and Bisalloy Steel

Assuming the 90 days trading horizon Regis Healthcare is expected to generate 0.47 times more return on investment than Bisalloy Steel. However, Regis Healthcare is 2.11 times less risky than Bisalloy Steel. It trades about 0.17 of its potential returns per unit of risk. Bisalloy Steel Group is currently generating about 0.05 per unit of risk. If you would invest  417.00  in Regis Healthcare on September 29, 2024 and sell it today you would earn a total of  217.00  from holding Regis Healthcare or generate 52.04% return on investment over 90 days.

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

Regis Healthcare  vs.  Bisalloy Steel Group

Regis Healthcare

Risk-Adjusted Performance

2 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Regis Healthcare are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Regis Healthcare is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Bisalloy Steel Group

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bisalloy Steel Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Bisalloy Steel unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Regis Healthcare and Bisalloy Steel

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

The idea behind Regis Healthcare and Bisalloy Steel Group 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.