Correlation Between Aveanna Healthcare and CryoCell International

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

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

Diversification Opportunities for Aveanna Healthcare and CryoCell International

-0.22

Correlation Coefficient

Aveanna Healthcare  CryoCell International

Very good diversification

The 3 months correlation between Aveanna and CryoCell is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Aveanna Healthcare Holdings and CryoCell International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CryoCell International and Aveanna 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 Aveanna Healthcare Holdings are associated (or correlated) with CryoCell International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CryoCell International has no effect on the direction of Aveanna Healthcare i.e., Aveanna Healthcare and CryoCell International go up and down completely randomly.

Pair Corralation between Aveanna Healthcare and CryoCell International

Given the investment horizon of 90 days Aveanna Healthcare Holdings is expected to generate 1.56 times more return on investment than CryoCell International. However, Aveanna Healthcare is 1.56 times more volatile than CryoCell International. It trades about 0.07 of its potential returns per unit of risk. CryoCell International is currently generating about -0.05 per unit of risk. If you would invest  466.00  in Aveanna Healthcare Holdings on December 27, 2024 and sell it today you would earn a total of  72.00  from holding Aveanna Healthcare Holdings or generate 15.45% return on investment over 90 days.

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

Aveanna Healthcare Holdings  vs.  CryoCell International

Aveanna Healthcare

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Aveanna Healthcare Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly unsteady basic indicators, Aveanna Healthcare demonstrated solid returns over the last few months and may actually be approaching a breakup point.

CryoCell International

Risk-Adjusted Performance

Very Weak

Over the last 90 days CryoCell International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's technical and fundamental indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Aveanna Healthcare and CryoCell International

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

The idea behind Aveanna Healthcare Holdings and CryoCell International 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.