Correlation Between Joint Corp and TruBridge

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

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

Diversification Opportunities for Joint Corp and TruBridge

-0.49

Correlation Coefficient

Joint Corp  TruBridge

Very good diversification

The 3 months correlation between Joint and TruBridge is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding The Joint Corp and TruBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TruBridge and Joint 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 The Joint Corp are associated (or correlated) with TruBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TruBridge has no effect on the direction of Joint Corp i.e., Joint Corp and TruBridge go up and down completely randomly.

Pair Corralation between Joint Corp and TruBridge

Given the investment horizon of 90 days The Joint Corp is expected to under-perform the TruBridge. In addition to that, Joint Corp is 1.17 times more volatile than TruBridge. It trades about -0.01 of its total potential returns per unit of risk. TruBridge is currently generating about 0.43 per unit of volatility. If you would invest  1,289  in TruBridge on October 21, 2024 and sell it today you would earn a total of  1,004  from holding TruBridge or generate 77.89% return on investment over 90 days.

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

The Joint Corp  vs.  TruBridge

Joint Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

TruBridge

Risk-Adjusted Performance

33 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in TruBridge are ranked lower than 33 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, TruBridge reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Joint Corp and TruBridge

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

The idea behind The Joint Corp and TruBridge 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.