Correlation Between Tenet Healthcare and JRSIS Health

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

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

Diversification Opportunities for Tenet Healthcare and JRSIS Health

0.66

Correlation Coefficient

Tenet Healthcare  JRSIS Health

Poor diversification

The 3 months correlation between Tenet and JRSIS is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Tenet Healthcare and JRSIS Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JRSIS Health Care and Tenet 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 Tenet Healthcare are associated (or correlated) with JRSIS Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JRSIS Health Care has no effect on the direction of Tenet Healthcare i.e., Tenet Healthcare and JRSIS Health go up and down completely randomly.

Pair Corralation between Tenet Healthcare and JRSIS Health

Considering the 90-day investment horizon Tenet Healthcare is expected to generate 0.22 times more return on investment than JRSIS Health. However, Tenet Healthcare is 4.49 times less risky than JRSIS Health. It trades about -0.01 of its potential returns per unit of risk. JRSIS Health Care is currently generating about -0.01 per unit of risk. If you would invest  13,868  in Tenet Healthcare on September 21, 2024 and sell it today you would lose (952.00) from holding Tenet Healthcare or give up 6.86% of portfolio value over 90 days.

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

Tenet Healthcare  vs.  JRSIS Health Care

Tenet Healthcare

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tenet Healthcare 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 technical indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

JRSIS Health Care

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JRSIS Health Care has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Tenet Healthcare and JRSIS Health

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

The idea behind Tenet Healthcare and JRSIS Health Care 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.