diversifiable risk of combining Sonida Senior and Integrated Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sonida Senior Living and Integrated Biopharma, you can compare the effects of market volatilities on Sonida Senior and Integrated Biopharma 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 Sonida Senior with a short position of Integrated Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sonida Senior and Integrated Biopharma.
Diversification Opportunities for Sonida Senior and Integrated Biopharma
Pair Corralation between Sonida Senior and Integrated Biopharma
Given the investment horizon of 90 days Sonida Senior Living is expected to generate 1.32 times more return on investment than Integrated Biopharma. However, Sonida Senior is 1.32 times more volatile than Integrated Biopharma. It trades about 0.26 of its potential returns per unit of risk. Integrated Biopharma is currently generating about -0.09 per unit of risk. If you would invest 885.00 in Sonida Senior Living on November 24, 2023 and sell it today you would earn a total of 325.00 from holding Sonida Senior Living or generate 36.72% return on investment over 90 days.
|3 Months [change]
Sonida Senior Living vs. Integrated Biopharma
Sonida Senior and Integrated Biopharma Volatility Contrast
Pair Trading with Sonida Senior and Integrated BiopharmaThe main advantage of trading using opposite Sonida Senior and Integrated Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sonida Senior position performs unexpectedly, Integrated Biopharma 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 Integrated Biopharma will offset losses from the drop in Integrated Biopharma's long position. The idea behind Sonida Senior Living and Integrated Biopharma 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.
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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