Correlation Between Doximity and Concentra Group

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

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

Diversification Opportunities for Doximity and Concentra Group

0.53

Correlation Coefficient

Doximity  Concentra Group

Very weak diversification

The 3 months correlation between Doximity and Concentra is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Doximity and Concentra Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concentra Group Holdings and Doximity 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 Doximity are associated (or correlated) with Concentra Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concentra Group Holdings has no effect on the direction of Doximity i.e., Doximity and Concentra Group go up and down completely randomly.

Pair Corralation between Doximity and Concentra Group

Given the investment horizon of 90 days Doximity is expected to generate 2.61 times more return on investment than Concentra Group. However, Doximity is 2.61 times more volatile than Concentra Group Holdings. It trades about 0.12 of its potential returns per unit of risk. Concentra Group Holdings is currently generating about 0.06 per unit of risk. If you would invest  5,300  in Doximity on November 28, 2024 and sell it today you would earn a total of  1,871  from holding Doximity or generate 35.3% return on investment over 90 days.

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

Doximity  vs.  Concentra Group Holdings

Doximity

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Doximity are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady fundamental indicators, Doximity unveiled solid returns over the last few months and may actually be approaching a breakup point.

Concentra Group Holdings

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Concentra Group Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, Concentra Group may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Doximity and Concentra Group

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

The idea behind Doximity and Concentra Group Holdings 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.