Correlation Between Waystar Holding and MultiPlan

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Can any of the company-specific risk be diversified away by investing in both Waystar Holding and MultiPlan 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 Waystar Holding and MultiPlan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Waystar Holding Corp and MultiPlan, you can compare the effects of market volatilities on Waystar Holding and MultiPlan 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 Waystar Holding with a short position of MultiPlan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Waystar Holding and MultiPlan.

Diversification Opportunities for Waystar Holding and MultiPlan

-0.56
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Waystar and MultiPlan is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Waystar Holding Corp and MultiPlan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MultiPlan and Waystar Holding 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 Waystar Holding Corp are associated (or correlated) with MultiPlan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MultiPlan has no effect on the direction of Waystar Holding i.e., Waystar Holding and MultiPlan go up and down completely randomly.

Pair Corralation between Waystar Holding and MultiPlan

Considering the 90-day investment horizon Waystar Holding Corp is expected to generate 0.19 times more return on investment than MultiPlan. However, Waystar Holding Corp is 5.29 times less risky than MultiPlan. It trades about 0.17 of its potential returns per unit of risk. MultiPlan is currently generating about 0.0 per unit of risk. If you would invest  2,652  in Waystar Holding Corp on September 3, 2024 and sell it today you would earn a total of  436.00  from holding Waystar Holding Corp or generate 16.44% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Waystar Holding Corp  vs.  MultiPlan

 Performance 
       Timeline  
Waystar Holding Corp 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Waystar Holding Corp are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Waystar Holding showed solid returns over the last few months and may actually be approaching a breakup point.
MultiPlan 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days MultiPlan has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy essential indicators, MultiPlan is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Waystar Holding and MultiPlan Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Waystar Holding and MultiPlan

The main advantage of trading using opposite Waystar Holding and MultiPlan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Waystar Holding position performs unexpectedly, MultiPlan 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 MultiPlan will offset losses from the drop in MultiPlan's long position.
The idea behind Waystar Holding Corp and MultiPlan 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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