Correlation Between International Consolidated and Absolute Health

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

Diversification Opportunities for International Consolidated and Absolute Health

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between International and Absolute is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding International Consolidated Air and Absolute Health and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Absolute Health and International Consolidated 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 International Consolidated Airlines are associated (or correlated) with Absolute Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Absolute Health has no effect on the direction of International Consolidated i.e., International Consolidated and Absolute Health go up and down completely randomly.

Pair Corralation between International Consolidated and Absolute Health

If you would invest  0.10  in Absolute Health and on March 21, 2024 and sell it today you would earn a total of  0.00  from holding Absolute Health and or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

International Consolidated Air  vs.  Absolute Health and

 Performance 
       Timeline  
International Consolidated 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in International Consolidated Airlines are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical and fundamental indicators, International Consolidated is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Absolute Health 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Absolute Health and has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Absolute Health is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

International Consolidated and Absolute Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with International Consolidated and Absolute Health

The main advantage of trading using opposite International Consolidated and Absolute Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Consolidated position performs unexpectedly, Absolute 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 Absolute Health will offset losses from the drop in Absolute Health's long position.
The idea behind International Consolidated Airlines and Absolute Health and 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.
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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 Managers module to screen money managers from public funds and ETFs managed around the world.

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