Correlation Between Centene Corp and Airsculpt Technologies

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

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

Diversification Opportunities for Centene Corp and Airsculpt Technologies

-0.63

Correlation Coefficient

Centene Corp  Airsculpt Technologies

Excellent diversification

The 3 months correlation between Centene and Airsculpt is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Centene Corp and Airsculpt Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Airsculpt Technologies and Centene 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 Centene Corp are associated (or correlated) with Airsculpt Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Airsculpt Technologies has no effect on the direction of Centene Corp i.e., Centene Corp and Airsculpt Technologies go up and down completely randomly.

Pair Corralation between Centene Corp and Airsculpt Technologies

Considering the 90-day investment horizon Centene Corp is expected to generate 0.36 times more return on investment than Airsculpt Technologies. However, Centene Corp is 2.75 times less risky than Airsculpt Technologies. It trades about -0.08 of its potential returns per unit of risk. Airsculpt Technologies is currently generating about -0.28 per unit of risk. If you would invest  6,143  in Centene Corp on September 24, 2024 and sell it today you would lose (185.00) from holding Centene Corp or give up 3.01% of portfolio value over 90 days.

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

Centene Corp  vs.  Airsculpt Technologies

Centene Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Centene Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Airsculpt Technologies

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Airsculpt Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Airsculpt Technologies is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Centene Corp and Airsculpt Technologies

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

The idea behind Centene Corp and Airsculpt Technologies 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.