Correlation Between CARDINAL HEALTH and BOS BETTER

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

By analyzing existing cross correlation between CARDINAL HEALTH and BOS BETTER ONLINE, you can compare the effects of market volatilities on CARDINAL HEALTH and BOS BETTER 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 CARDINAL HEALTH with a short position of BOS BETTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of CARDINAL HEALTH and BOS BETTER.

Diversification Opportunities for CARDINAL HEALTH and BOS BETTER

0.0

Correlation Coefficient

CARDINAL HEALTH  BOS BETTER

Pay attention - limited upside

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

Pair Corralation between CARDINAL HEALTH and BOS BETTER

If you would invest  11,280  in CARDINAL HEALTH on December 22, 2024 and sell it today you would earn a total of  955.00  from holding CARDINAL HEALTH or generate 8.47% return on investment over 90 days.

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

CARDINAL HEALTH  vs.  BOS BETTER ONLINE

CARDINAL HEALTH

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CARDINAL HEALTH are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady technical indicators, CARDINAL HEALTH may actually be approaching a critical reversion point that can send shares even higher in April 2025.

BOS BETTER ONLINE

Risk-Adjusted Performance

Very Weak

Over the last 90 days BOS BETTER ONLINE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, BOS BETTER is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with CARDINAL HEALTH and BOS BETTER

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

The idea behind CARDINAL HEALTH and BOS BETTER ONLINE 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.