Correlation Between CVS HEALTH and Mattr Corp

Can any of the company-specific risk be diversified away by investing in both CVS HEALTH and Mattr Corp 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 CVS HEALTH and Mattr Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CVS HEALTH CDR and Mattr Corp, you can compare the effects of market volatilities on CVS HEALTH and Mattr Corp 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 Mattr Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS HEALTH and Mattr Corp.

Diversification Opportunities for CVS HEALTH and Mattr Corp

-0.77

Correlation Coefficient

CVS HEALTH  Mattr Corp

Pay attention - limited upside

The 3 months correlation between CVS and Mattr is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding CVS HEALTH CDR and Mattr Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mattr Corp 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 CDR are associated (or correlated) with Mattr Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mattr Corp has no effect on the direction of CVS HEALTH i.e., CVS HEALTH and Mattr Corp go up and down completely randomly.

Pair Corralation between CVS HEALTH and Mattr Corp

Assuming the 90 days trading horizon CVS HEALTH CDR is expected to generate 0.61 times more return on investment than Mattr Corp. However, CVS HEALTH CDR is 1.64 times less risky than Mattr Corp. It trades about 0.09 of its potential returns per unit of risk. Mattr Corp is currently generating about 0.04 per unit of risk. If you would invest  1,536  in CVS HEALTH CDR on July 3, 2025 and sell it today you would earn a total of  302.00  from holding CVS HEALTH CDR or generate 19.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

CVS HEALTH CDR  vs.  Mattr Corp

CVS HEALTH CDR

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in CVS HEALTH CDR are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, CVS HEALTH may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Mattr Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Mattr Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in November 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with CVS HEALTH and Mattr Corp

The main advantage of trading using opposite CVS HEALTH and Mattr Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS HEALTH position performs unexpectedly, Mattr Corp 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 Mattr Corp will offset losses from the drop in Mattr Corp's long position.

The idea behind CVS HEALTH CDR and Mattr Corp 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.