Correlation Between Sonida Senior and Kaltura

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

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

Diversification Opportunities for Sonida Senior and Kaltura

0.27

Correlation Coefficient

Sonida Senior  Kaltura

Modest diversification

The 3 months correlation between Sonida and Kaltura is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Sonida Senior Living and Kaltura in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaltura and Sonida Senior 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 Sonida Senior Living are associated (or correlated) with Kaltura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaltura has no effect on the direction of Sonida Senior i.e., Sonida Senior and Kaltura go up and down completely randomly.

Pair Corralation between Sonida Senior and Kaltura

Given the investment horizon of 90 days Sonida Senior Living is expected to generate 0.45 times more return on investment than Kaltura. However, Sonida Senior Living is 2.23 times less risky than Kaltura. It trades about 0.03 of its potential returns per unit of risk. Kaltura is currently generating about -0.02 per unit of risk. If you would invest  2,274  in Sonida Senior Living on December 29, 2024 and sell it today you would earn a total of  48.00  from holding Sonida Senior Living or generate 2.11% return on investment over 90 days.

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

Sonida Senior Living  vs.  Kaltura

Sonida Senior Living

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sonida Senior Living are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, Sonida Senior is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Kaltura

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kaltura has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Kaltura is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Sonida Senior and Kaltura

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

The idea behind Sonida Senior Living and Kaltura 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.