Correlation Between Spire Healthcare and Secure Property

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

By analyzing existing cross correlation between Spire Healthcare Group and Secure Property Development, you can compare the effects of market volatilities on Spire Healthcare and Secure Property 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 Spire Healthcare with a short position of Secure Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Healthcare and Secure Property.

Diversification Opportunities for Spire Healthcare and Secure Property

-0.33

Correlation Coefficient

Spire Healthcare  Secure Property

Very good diversification

The 3 months correlation between Spire and Secure is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Spire Healthcare Group and Secure Property Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Secure Property Deve and Spire 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 Spire Healthcare Group are associated (or correlated) with Secure Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Secure Property Deve has no effect on the direction of Spire Healthcare i.e., Spire Healthcare and Secure Property go up and down completely randomly.

Pair Corralation between Spire Healthcare and Secure Property

Assuming the 90 days trading horizon Spire Healthcare Group is expected to generate 0.27 times more return on investment than Secure Property. However, Spire Healthcare Group is 3.74 times less risky than Secure Property. It trades about 0.04 of its potential returns per unit of risk. Secure Property Development is currently generating about -0.09 per unit of risk. If you would invest  22,200  in Spire Healthcare Group on December 1, 2024 and sell it today you would earn a total of  450.00  from holding Spire Healthcare Group or generate 2.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Spire Healthcare Group  vs.  Secure Property Development

Spire Healthcare

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Spire Healthcare Group are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Spire Healthcare is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Secure Property Deve

Risk-Adjusted Performance

Very Weak

Over the last 90 days Secure Property Development has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Spire Healthcare and Secure Property

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

The idea behind Spire Healthcare Group and Secure Property Development 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.