Correlation Analysis Between CVS Health and Home Depot

This module allows you to analyze existing cross correlation between CVS Health Corporation and The Home Depot. You can compare the effects of market volatilities on CVS Health and Home Depot 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 CVS Health with a short position of Home Depot. See also your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and Home Depot.
Horizon     30 Days    Login   to change
Symbolsvs
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Comparative Performance

CVS Health  
00

Risk-Adjusted Performance

Over the last 30 days CVS Health Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. In defiance of relatively invariable forward-looking signals, CVS Health is not utilizing all of its potentials. The prevalent stock price agitation, may contribute to short running losses for the management.
Home Depot  
22

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in The Home Depot are ranked lower than 2 (%) of all global equities and portfolios over the last 30 days. In spite of rather sound fundamental drivers, Home Depot is not utilizing all of its potentials. The new stock price tumult, may contribute to shorter-term losses for the shareholders.

CVS Health and Home Depot Volatility Contrast

 Predicted Return Density 
      Returns 

CVS Health Corp.  vs.  The Home Depot Inc

 Performance (%) 
      Timeline 

Pair Volatility

Considering 30-days investment horizon, CVS Health Corporation is expected to under-perform the Home Depot. In addition to that, CVS Health is 1.62 times more volatile than The Home Depot. It trades about -0.06 of its total potential returns per unit of risk. The Home Depot is currently generating about 0.03 per unit of volatility. If you would invest  18,875  in The Home Depot on April 21, 2019 and sell it today you would earn a total of  215.00  from holding The Home Depot or generate 1.14% return on investment over 30 days.

Pair Corralation between CVS Health and Home Depot

-0.42
Time Period2 Months [change]
DirectionNegative 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Diversification Opportunities for CVS Health and Home Depot

CVS Health Corp. diversification synergy

Very good diversification

Overlapping area represents the amount of risk that can be diversified away by holding CVS Health Corp. and The Home Depot Inc in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Home Depot and CVS Health 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 CVS Health Corporation are associated (or correlated) with Home Depot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Depot has no effect on the direction of CVS Health i.e. CVS Health and Home Depot go up and down completely randomly.
See also your portfolio center. Please also try Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.


 
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