Correlation Between Capital Senior and Ensign
Can any of the company-specific risk be diversified away by investing in both Capital Senior and Ensign 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 Capital Senior and Ensign into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital Senior Living and The Ensign Group, you can compare the effects of market volatilities on Capital Senior and Ensign 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 Capital Senior with a short position of Ensign. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Senior and Ensign.
Diversification Opportunities for Capital Senior and Ensign
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Capital and Ensign is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Capital Senior Living and The Ensign Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ensign Group and Capital Senior 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 Capital Senior Living are associated (or correlated) with Ensign. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ensign Group has no effect on the direction of Capital Senior i.e., Capital Senior and Ensign go up and down completely randomly.
Pair Corralation between Capital Senior and Ensign
If you would invest 7,871 in The Ensign Group on January 21, 2024 and sell it today you would earn a total of 3,955 from holding The Ensign Group or generate 50.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Capital Senior Living vs. The Ensign Group
Performance |
| Timeline |
| Capital Senior Living |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ensign Group |
Capital Senior and Ensign Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Senior and Ensign
The main advantage of trading using opposite Capital Senior and Ensign positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Senior position performs unexpectedly, Ensign 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 Ensign will offset losses from the drop in Ensign's long position.| Capital Senior vs. MYR Group | Capital Senior vs. Cedar Realty Trust | Capital Senior vs. Artisan Partners Asset | Capital Senior vs. Hurco Companies |
| Ensign vs. Certara | Ensign vs. HealthStream | Ensign vs. Evolent Health | Ensign vs. Streamline Health Solutions |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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