Correlation Between Shagrir Group and CVS Health
Can any of the company-specific risk be diversified away by investing in both Shagrir Group and CVS 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 Shagrir Group and CVS Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shagrir Group Vehicle and CVS Health Corp, you can compare the effects of market volatilities on Shagrir Group 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 Shagrir Group with a short position of CVS Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shagrir Group and CVS Health.
Diversification Opportunities for Shagrir Group and CVS Health
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shagrir and CVS is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Shagrir Group Vehicle and CVS Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVS Health Corp and Shagrir Group 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 Shagrir Group Vehicle 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 Corp has no effect on the direction of Shagrir Group i.e., Shagrir Group and CVS Health go up and down completely randomly.
Pair Corralation between Shagrir Group and CVS Health
Assuming the 90 days trading horizon Shagrir Group Vehicle is expected to generate 1.67 times more return on investment than CVS Health. However, Shagrir Group is 1.67 times more volatile than CVS Health Corp. It trades about 0.04 of its potential returns per unit of risk. CVS Health Corp is currently generating about -0.03 per unit of risk. If you would invest 81,540 in Shagrir Group Vehicle on January 24, 2024 and sell it today you would earn a total of 14,100 from holding Shagrir Group Vehicle or generate 17.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 78.62% |
| Values | Daily Returns |
Shagrir Group Vehicle vs. CVS Health Corp
Performance |
| Timeline |
| Shagrir Group Vehicle |
| CVS Health Corp |
Shagrir Group and CVS Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shagrir Group and CVS Health
The main advantage of trading using opposite Shagrir Group and CVS Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shagrir Group position performs unexpectedly, CVS 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 CVS Health will offset losses from the drop in CVS Health's long position.| Shagrir Group vs. Al Bad Massuot Yitzhak | Shagrir Group vs. Gan Shmuel | Shagrir Group vs. Analyst IMS Investment |
| CVS Health vs. Humana Inc | CVS Health vs. Cigna Corp | CVS Health vs. Elevance Health | CVS Health vs. Centene Corp |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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