Correlation Between AMN Healthcare and Joint Corp

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

By analyzing existing cross correlation between AMN Healthcare Services and The Joint Corp, you can compare the effects of market volatilities on AMN Healthcare and Joint Corp 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 AMN Healthcare with a short position of Joint Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMN Healthcare and Joint Corp.

Diversification Opportunities for AMN Healthcare and Joint Corp

0.0

Correlation Coefficient

AMN Healthcare  Joint Corp

Pay attention - limited upside

The 3 months correlation between AMN and Joint is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AMN Healthcare Services and The Joint Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Joint Corp and AMN 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 AMN Healthcare Services are associated (or correlated) with Joint Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Joint Corp has no effect on the direction of AMN Healthcare i.e., AMN Healthcare and Joint Corp go up and down completely randomly.

Pair Corralation between AMN Healthcare and Joint Corp

Considering the 90-day investment horizon AMN Healthcare is expected to generate 12.68 times less return on investment than Joint Corp. In addition to that, AMN Healthcare is 1.22 times more volatile than The Joint Corp. It trades about 0.01 of its total potential returns per unit of risk. The Joint Corp is currently generating about 0.17 per unit of volatility. If you would invest  1,018  in The Joint Corp on December 26, 2024 and sell it today you would earn a total of  257.00  from holding The Joint Corp or generate 25.25% return on investment over 90 days.

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

AMN Healthcare Services  vs.  The Joint Corp

AMN Healthcare Services

Risk-Adjusted Performance

Very Weak

Over the last 90 days AMN Healthcare Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, AMN Healthcare is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Joint Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Joint Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Joint Corp unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AMN Healthcare and Joint Corp

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

The idea behind AMN Healthcare Services and The Joint Corp 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.