Correlation Analysis Between Home Depot and CVS Health

This module allows you to analyze existing cross correlation between Home Depot and CVS Health Corporation. You can compare the effects of market volatilities on Home Depot and CVS 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 Home Depot with a short position of CVS Health. See also your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and CVS Health.
Horizon     30 Days    Login   to change
Symbolsvs
Check Efficiency

Comparative Performance

Home Depot  
88

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Home Depot are ranked lower than 8 (%) of all global equities and portfolios over the last 30 days. In spite of rather sluggish fundamental drivers, Home Depot may actually be approaching a critical reversion point that can send shares even higher in November 2019.
CVS Health  
1111

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in CVS Health Corporation are ranked lower than 11 (%) of all global equities and portfolios over the last 30 days. In defiance of relatively fragile forward-looking signals, CVS Health reported solid returns over the last few months and may actually be approaching a breakup point.

Home Depot and CVS Health Volatility Contrast

 Predicted Return Density 
      Returns 

Home Depot Inc  vs.  CVS Health Corp.

 Performance (%) 
      Timeline 

Pair Volatility

Allowing for the 30-days total investment horizon, Home Depot is expected to generate 1.62 times less return on investment than CVS Health. But when comparing it to its historical volatility, Home Depot is 1.24 times less risky than CVS Health. It trades about 0.12 of its potential returns per unit of risk. CVS Health Corporation is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  5,600  in CVS Health Corporation on September 16, 2019 and sell it today you would earn a total of  964.00  from holding CVS Health Corporation or generate 17.21% return on investment over 30 days.

Pair Corralation between Home Depot and CVS Health

0.77
Time Period3 Months [change]
DirectionPositive 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for Home Depot and CVS Health

Home Depot Inc diversification synergy

Poor diversification

Overlapping area represents the amount of risk that can be diversified away by holding Home Depot Inc and CVS Health Corp. in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on CVS Health and Home Depot 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 Home Depot are associated (or correlated) with CVS Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVS Health has no effect on the direction of Home Depot i.e. Home Depot and CVS Health go up and down completely randomly.
See also your portfolio center. Please also try Money Flow Index module to determine momentum by analyzing money flow index and other technical indicators.


 
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