Correlation Between Centene Corp and Integer Holdings

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

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

Diversification Opportunities for Centene Corp and Integer Holdings

0.31

Correlation Coefficient

Centene Corp  Integer Holdings

Weak diversification

The 3 months correlation between Centene and Integer is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Centene Corp and Integer Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integer Holdings Corp 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 Integer Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integer Holdings Corp has no effect on the direction of Centene Corp i.e., Centene Corp and Integer Holdings go up and down completely randomly.

Pair Corralation between Centene Corp and Integer Holdings

Considering the 90-day investment horizon Centene Corp is expected to generate 1.21 times more return on investment than Integer Holdings. However, Centene Corp is 1.21 times more volatile than Integer Holdings Corp. It trades about -0.01 of its potential returns per unit of risk. Integer Holdings Corp is currently generating about -0.1 per unit of risk. If you would invest  6,000  in Centene Corp on November 28, 2024 and sell it today you would lose (107.00) from holding Centene Corp or give up 1.78% of portfolio value over 90 days.

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

Centene Corp  vs.  Integer Holdings Corp

Centene Corp

Risk-Adjusted Performance

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 rather sound basic indicators, Centene Corp is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Integer Holdings Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Integer Holdings Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with Centene Corp and Integer Holdings

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

The idea behind Centene Corp and Integer Holdings Corp 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.