Correlation Between Aspira Womens and CareCloud

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

By analyzing existing cross correlation between Aspira Womens Health and CareCloud, you can compare the effects of market volatilities on Aspira Womens and CareCloud 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 Aspira Womens with a short position of CareCloud. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspira Womens and CareCloud.

Diversification Opportunities for Aspira Womens and CareCloud

-0.36

Correlation Coefficient

Aspira Womens  CareCloud

Very good diversification

The 3 months correlation between Aspira and CareCloud is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Aspira Womens Health and CareCloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CareCloud and Aspira Womens 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 Aspira Womens Health are associated (or correlated) with CareCloud. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CareCloud has no effect on the direction of Aspira Womens i.e., Aspira Womens and CareCloud go up and down completely randomly.

Pair Corralation between Aspira Womens and CareCloud

Considering the 90-day investment horizon Aspira Womens Health is expected to under-perform the CareCloud. But the stock apears to be less risky and, when comparing its historical volatility, Aspira Womens Health is 1.38 times less risky than CareCloud. The stock trades about -0.02 of its potential returns per unit of risk. The CareCloud is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  282.00  in CareCloud on September 13, 2024 and sell it today you would earn a total of  113.00  from holding CareCloud or generate 40.07% return on investment over 90 days.

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

Aspira Womens Health  vs.  CareCloud

Aspira Womens Health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aspira Womens Health has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Aspira Womens is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

CareCloud

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CareCloud are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak essential indicators, CareCloud exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aspira Womens and CareCloud

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

The idea behind Aspira Womens Health and CareCloud 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 Transaction History module to view history of all your transactions and understand their impact on performance.