Correlation Between National Health and Brockhaus Capital
Can any of the company-specific risk be diversified away by investing in both National Health and Brockhaus 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 National Health and Brockhaus Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Health Investors and Brockhaus Capital Management, you can compare the effects of market volatilities on National Health and Brockhaus 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 National Health with a short position of Brockhaus Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Health and Brockhaus Capital.
Diversification Opportunities for National Health and Brockhaus Capital
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between National and Brockhaus is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding National Health Investors and Brockhaus Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brockhaus Capital and National 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 National Health Investors are associated (or correlated) with Brockhaus Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brockhaus Capital has no effect on the direction of National Health i.e., National Health and Brockhaus Capital go up and down completely randomly.
Pair Corralation between National Health and Brockhaus Capital
Assuming the 90 days trading horizon National Health Investors is expected to generate 0.8 times more return on investment than Brockhaus Capital. However, National Health Investors is 1.25 times less risky than Brockhaus Capital. It trades about -0.05 of its potential returns per unit of risk. Brockhaus Capital Management is currently generating about -0.08 per unit of risk. If you would invest 7,000 in National Health Investors on September 23, 2024 and sell it today you would lose (400.00) from holding National Health Investors or give up 5.71% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
National Health Investors vs. Brockhaus Capital Management
Performance |
Timeline |
National Health Investors |
Brockhaus Capital |
National Health and Brockhaus Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with National Health and Brockhaus Capital
The main advantage of trading using opposite National Health and Brockhaus Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Health position performs unexpectedly, Brockhaus 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 Brockhaus Capital will offset losses from the drop in Brockhaus Capital's long position.National Health vs. Apple Inc | National Health vs. Apple Inc | National Health vs. Apple Inc | National Health vs. Apple Inc |
Brockhaus Capital vs. Blackstone Group | Brockhaus Capital vs. The Bank of | Brockhaus Capital vs. Ameriprise Financial | Brockhaus Capital vs. State Street |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
Stocks Directory Find actively traded stocks across global markets | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |