Correlation Between InnovAge Holding and Astrana Health

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

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

Diversification Opportunities for InnovAge Holding and Astrana Health

0.21

Correlation Coefficient

InnovAge Holding  Astrana Health

Modest diversification

The 3 months correlation between InnovAge and Astrana is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding InnovAge Holding Corp and Astrana Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astrana Health and InnovAge Holding 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 InnovAge Holding Corp are associated (or correlated) with Astrana Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astrana Health has no effect on the direction of InnovAge Holding i.e., InnovAge Holding and Astrana Health go up and down completely randomly.

Pair Corralation between InnovAge Holding and Astrana Health

If you would invest  3,407  in Astrana Health on September 2, 2024 and sell it today you would earn a total of  0.00  from holding Astrana Health or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

InnovAge Holding Corp  vs.  Astrana Health

InnovAge Holding Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days InnovAge Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Astrana Health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Astrana Health has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Astrana Health is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with InnovAge Holding and Astrana Health

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

The idea behind InnovAge Holding Corp and Astrana Health 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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.