Correlation Between ADDUS HOMECARE and PICKN PAY
Can any of the company-specific risk be diversified away by investing in both ADDUS HOMECARE and PICKN PAY 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 ADDUS HOMECARE and PICKN PAY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ADDUS HOMECARE and PICKN PAY STORES, you can compare the effects of market volatilities on ADDUS HOMECARE and PICKN PAY 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 ADDUS HOMECARE with a short position of PICKN PAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADDUS HOMECARE and PICKN PAY.
Diversification Opportunities for ADDUS HOMECARE and PICKN PAY
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between ADDUS and PICKN is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding ADDUS HOMECARE and PICKN PAY STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PICKN PAY STORES and ADDUS HOMECARE 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 ADDUS HOMECARE are associated (or correlated) with PICKN PAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PICKN PAY STORES has no effect on the direction of ADDUS HOMECARE i.e., ADDUS HOMECARE and PICKN PAY go up and down completely randomly.
Pair Corralation between ADDUS HOMECARE and PICKN PAY
Assuming the 90 days trading horizon ADDUS HOMECARE is expected to generate 0.66 times more return on investment than PICKN PAY. However, ADDUS HOMECARE is 1.51 times less risky than PICKN PAY. It trades about 0.07 of its potential returns per unit of risk. PICKN PAY STORES is currently generating about 0.01 per unit of risk. If you would invest 8,700 in ADDUS HOMECARE on April 24, 2025 and sell it today you would earn a total of 550.00 from holding ADDUS HOMECARE or generate 6.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
ADDUS HOMECARE vs. PICKN PAY STORES
Performance |
Timeline |
ADDUS HOMECARE |
PICKN PAY STORES |
ADDUS HOMECARE and PICKN PAY Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ADDUS HOMECARE and PICKN PAY
The main advantage of trading using opposite ADDUS HOMECARE and PICKN PAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADDUS HOMECARE position performs unexpectedly, PICKN PAY 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 PICKN PAY will offset losses from the drop in PICKN PAY's long position.ADDUS HOMECARE vs. CSSC Offshore Marine | ADDUS HOMECARE vs. Grand Canyon Education | ADDUS HOMECARE vs. BW OFFSHORE LTD | ADDUS HOMECARE vs. WT OFFSHORE |
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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 Stocks Directory module to find actively traded stocks across global markets.
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