Correlation Between Regis Healthcare and Recce
Can any of the company-specific risk be diversified away by investing in both Regis Healthcare and Recce 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 Regis Healthcare and Recce into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regis Healthcare and Recce, you can compare the effects of market volatilities on Regis Healthcare and Recce 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 Regis Healthcare with a short position of Recce. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regis Healthcare and Recce.
Diversification Opportunities for Regis Healthcare and Recce
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Regis and Recce is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Regis Healthcare and Recce in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Recce and Regis Healthcare 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 Regis Healthcare are associated (or correlated) with Recce. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Recce has no effect on the direction of Regis Healthcare i.e., Regis Healthcare and Recce go up and down completely randomly.
Pair Corralation between Regis Healthcare and Recce
Assuming the 90 days trading horizon Regis Healthcare is expected to generate 0.5 times more return on investment than Recce. However, Regis Healthcare is 2.02 times less risky than Recce. It trades about 0.11 of its potential returns per unit of risk. Recce is currently generating about -0.12 per unit of risk. If you would invest 611.00 in Regis Healthcare on December 29, 2024 and sell it today you would earn a total of 77.00 from holding Regis Healthcare or generate 12.6% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Regis Healthcare vs. Recce
Performance |
Timeline |
Regis Healthcare |
Recce |
Regis Healthcare and Recce Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Regis Healthcare and Recce
The main advantage of trading using opposite Regis Healthcare and Recce positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regis Healthcare position performs unexpectedly, Recce 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 Recce will offset losses from the drop in Recce's long position.Regis Healthcare vs. National Storage REIT | Regis Healthcare vs. Iron Road | Regis Healthcare vs. Bluescope Steel | Regis Healthcare vs. Vulcan Steel |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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