Correlation Between Biote Corp and Pennant
Can any of the company-specific risk be diversified away by investing in both Biote Corp and Pennant 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 Biote Corp and Pennant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between biote Corp and Pennant Group, you can compare the effects of market volatilities on Biote Corp and Pennant 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 Biote Corp with a short position of Pennant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biote Corp and Pennant.
Diversification Opportunities for Biote Corp and Pennant
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Biote and Pennant is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding biote Corp and Pennant Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pennant Group and Biote Corp 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 biote Corp are associated (or correlated) with Pennant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pennant Group has no effect on the direction of Biote Corp i.e., Biote Corp and Pennant go up and down completely randomly.
Pair Corralation between Biote Corp and Pennant
Given the investment horizon of 90 days biote Corp is expected to generate 2.44 times more return on investment than Pennant. However, Biote Corp is 2.44 times more volatile than Pennant Group. It trades about 0.06 of its potential returns per unit of risk. Pennant Group is currently generating about -0.15 per unit of risk. If you would invest 513.00 in biote Corp on October 25, 2024 and sell it today you would earn a total of 52.00 from holding biote Corp or generate 10.14% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
biote Corp vs. Pennant Group
Performance |
Timeline |
biote Corp |
Pennant Group |
Biote Corp and Pennant Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Biote Corp and Pennant
The main advantage of trading using opposite Biote Corp and Pennant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biote Corp position performs unexpectedly, Pennant 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 Pennant will offset losses from the drop in Pennant's long position.Biote Corp vs. Encompass Health Corp | Biote Corp vs. Pennant Group | Biote Corp vs. The Ensign Group | Biote Corp vs. InnovAge Holding Corp |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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