Correlation Between Sonic Healthcare and Accent Resources

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

By analyzing existing cross correlation between Sonic Healthcare and Accent Resources NL, you can compare the effects of market volatilities on Sonic Healthcare and Accent Resources 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 Sonic Healthcare with a short position of Accent Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonic Healthcare and Accent Resources.

Diversification Opportunities for Sonic Healthcare and Accent Resources

0.0

Correlation Coefficient

Sonic Healthcare  Accent Resources

Pay attention - limited upside

The 3 months correlation between Sonic and Accent is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sonic Healthcare and Accent Resources NL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accent Resources and Sonic 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 Sonic Healthcare are associated (or correlated) with Accent Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accent Resources has no effect on the direction of Sonic Healthcare i.e., Sonic Healthcare and Accent Resources go up and down completely randomly.

Pair Corralation between Sonic Healthcare and Accent Resources

If you would invest  2,691  in Sonic Healthcare on September 4, 2024 and sell it today you would earn a total of  208.00  from holding Sonic Healthcare or generate 7.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Sonic Healthcare  vs.  Accent Resources NL

Sonic Healthcare

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Sonic Healthcare are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain essential indicators, Sonic Healthcare may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Accent Resources

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Sonic Healthcare and Accent Resources

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

The idea behind Sonic Healthcare and Accent Resources NL 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.

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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.