Correlation Between Brookdale Senior and Cano Health

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Brookdale Senior and Cano Health 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 Brookdale Senior and Cano Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookdale Senior Living and Cano Health, you can compare the effects of market volatilities on Brookdale Senior and Cano Health 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 Brookdale Senior with a short position of Cano Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookdale Senior and Cano Health.

Diversification Opportunities for Brookdale Senior and Cano Health

-0.59
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Brookdale and Cano is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Brookdale Senior Living and Cano Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cano Health and Brookdale Senior 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 Brookdale Senior Living are associated (or correlated) with Cano Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cano Health has no effect on the direction of Brookdale Senior i.e., Brookdale Senior and Cano Health go up and down completely randomly.

Pair Corralation between Brookdale Senior and Cano Health

If you would invest  137.00  in Cano Health on August 31, 2024 and sell it today you would earn a total of  0.00  from holding Cano Health or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy1.59%
ValuesDaily Returns

Brookdale Senior Living  vs.  Cano Health

 Performance 
       Timeline  
Brookdale Senior Living 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Brookdale Senior Living has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's forward-looking signals remain rather sound which may send shares a bit higher in December 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
Cano Health 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Cano Health has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Cano Health is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Brookdale Senior and Cano Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Brookdale Senior and Cano Health

The main advantage of trading using opposite Brookdale Senior and Cano Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookdale Senior position performs unexpectedly, Cano Health 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 Cano Health will offset losses from the drop in Cano Health's long position.
The idea behind Brookdale Senior Living and Cano Health 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 CEOs Directory module to screen CEOs from public companies around the world.

Other Complementary Tools

Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing