Correlation Between Alignment Healthcare and Trump Media

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

By analyzing existing cross correlation between Alignment Healthcare LLC and Trump Media Technology, you can compare the effects of market volatilities on Alignment Healthcare and Trump Media 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 Alignment Healthcare with a short position of Trump Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alignment Healthcare and Trump Media.

Diversification Opportunities for Alignment Healthcare and Trump Media

-0.01

Correlation Coefficient

Alignment Healthcare  Trump Media

Good diversification

The 3 months correlation between Alignment and Trump is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Alignment Healthcare LLC and Trump Media Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trump Media Technology and Alignment 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 Alignment Healthcare LLC are associated (or correlated) with Trump Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trump Media Technology has no effect on the direction of Alignment Healthcare i.e., Alignment Healthcare and Trump Media go up and down completely randomly.

Pair Corralation between Alignment Healthcare and Trump Media

Given the investment horizon of 90 days Alignment Healthcare LLC is expected to generate 0.52 times more return on investment than Trump Media. However, Alignment Healthcare LLC is 1.92 times less risky than Trump Media. It trades about 0.49 of its potential returns per unit of risk. Trump Media Technology is currently generating about -0.05 per unit of risk. If you would invest  1,084  in Alignment Healthcare LLC on October 26, 2024 and sell it today you would earn a total of  373.00  from holding Alignment Healthcare LLC or generate 34.41% return on investment over 90 days.

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

Alignment Healthcare LLC  vs.  Trump Media Technology

Alignment Healthcare LLC

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Alignment Healthcare LLC are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical indicators, Alignment Healthcare exhibited solid returns over the last few months and may actually be approaching a breakup point.

Trump Media Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trump Media Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward-looking indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Alignment Healthcare and Trump Media

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

The idea behind Alignment Healthcare LLC and Trump Media Technology 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.