Correlation Between Centene Corp and Digimarc
Can any of the company-specific risk be diversified away by investing in both Centene Corp and Digimarc 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 Centene Corp and Digimarc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centene Corp and Digimarc, you can compare the effects of market volatilities on Centene Corp and Digimarc 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 Centene Corp with a short position of Digimarc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centene Corp and Digimarc.
Diversification Opportunities for Centene Corp and Digimarc
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Centene and Digimarc is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Centene Corp and Digimarc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digimarc and Centene Corp 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 Centene Corp are associated (or correlated) with Digimarc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digimarc has no effect on the direction of Centene Corp i.e., Centene Corp and Digimarc go up and down completely randomly.
Pair Corralation between Centene Corp and Digimarc
Considering the 90-day investment horizon Centene Corp is expected to under-perform the Digimarc. But the stock apears to be less risky and, when comparing its historical volatility, Centene Corp is 2.46 times less risky than Digimarc. The stock trades about -0.01 of its potential returns per unit of risk. The Digimarc is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,488 in Digimarc on January 19, 2024 and sell it today you would earn a total of 777.00 from holding Digimarc or generate 52.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centene Corp vs. Digimarc
Performance |
| Timeline |
| Centene Corp |
| Digimarc |
Centene Corp and Digimarc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centene Corp and Digimarc
The main advantage of trading using opposite Centene Corp and Digimarc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centene Corp position performs unexpectedly, Digimarc 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 Digimarc will offset losses from the drop in Digimarc's long position.The idea behind Centene Corp and Digimarc 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.| Digimarc vs. Pfizer Inc | Digimarc vs. Home Federal Bancorp | Digimarc vs. Betterware De Mexico | Digimarc vs. Heartland Financial USA |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Stocks Directory Find actively traded stocks across global markets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |