Correlation Between Tenet Healthcare and Intel
Can any of the company-specific risk be diversified away by investing in both Tenet Healthcare and Intel 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 Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tenet Healthcare and Intel, you can compare the effects of market volatilities on Tenet Healthcare and Intel 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 Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tenet Healthcare and Intel.
Diversification Opportunities for Tenet Healthcare and Intel
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tenet and Intel is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Tenet Healthcare and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel 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 Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Tenet Healthcare i.e., Tenet Healthcare and Intel go up and down completely randomly.
Pair Corralation between Tenet Healthcare and Intel
Considering the 90-day investment horizon Tenet Healthcare is expected to generate 0.72 times more return on investment than Intel. However, Tenet Healthcare is 1.38 times less risky than Intel. It trades about -0.09 of its potential returns per unit of risk. Intel is currently generating about -0.34 per unit of risk. If you would invest 10,232 in Tenet Healthcare on January 26, 2024 and sell it today you would lose (406.00) from holding Tenet Healthcare or give up 3.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tenet Healthcare vs. Intel
Performance |
| Timeline |
| Tenet Healthcare |
| Intel |
Tenet Healthcare and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tenet Healthcare and Intel
The main advantage of trading using opposite Tenet Healthcare and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tenet Healthcare position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Tenet Healthcare vs. Acadia Healthcare | Tenet Healthcare vs. HCA Holdings | Tenet Healthcare vs. US Physicalrapy | Tenet Healthcare vs. DaVita HealthCare Partners |
| Intel vs. NVIDIA | Intel vs. Taiwan Semiconductor Manufacturing | Intel vs. Marvell Technology Group | Intel vs. Micron Technology |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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