Correlation Between Sabra Health and QURATE RETAIL
Can any of the company-specific risk be diversified away by investing in both Sabra Health and QURATE RETAIL 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 Sabra Health and QURATE RETAIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Health Care and QURATE RETAIL INC, you can compare the effects of market volatilities on Sabra Health and QURATE RETAIL 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 Sabra Health with a short position of QURATE RETAIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Health and QURATE RETAIL.
Diversification Opportunities for Sabra Health and QURATE RETAIL
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sabra and QURATE is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Health Care and QURATE RETAIL INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QURATE RETAIL INC and Sabra Health 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 Sabra Health Care are associated (or correlated) with QURATE RETAIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QURATE RETAIL INC has no effect on the direction of Sabra Health i.e., Sabra Health and QURATE RETAIL go up and down completely randomly.
Pair Corralation between Sabra Health and QURATE RETAIL
Assuming the 90 days horizon Sabra Health Care is expected to under-perform the QURATE RETAIL. But the stock apears to be less risky and, when comparing its historical volatility, Sabra Health Care is 18.21 times less risky than QURATE RETAIL. The stock trades about -0.02 of its potential returns per unit of risk. The QURATE RETAIL INC is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 280.00 in QURATE RETAIL INC on December 5, 2024 and sell it today you would earn a total of 670.00 from holding QURATE RETAIL INC or generate 239.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Sabra Health Care vs. QURATE RETAIL INC
Performance |
Timeline |
Sabra Health Care |
QURATE RETAIL INC |
Sabra Health and QURATE RETAIL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sabra Health and QURATE RETAIL
The main advantage of trading using opposite Sabra Health and QURATE RETAIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Health position performs unexpectedly, QURATE RETAIL 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 QURATE RETAIL will offset losses from the drop in QURATE RETAIL's long position.Sabra Health vs. SOFI TECHNOLOGIES | Sabra Health vs. Easy Software AG | Sabra Health vs. PURETECH HEALTH PLC | Sabra Health vs. Planet Fitness |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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