Correlation Between GlobalData PLC and Inspiration Healthcare

Can any of the company-specific risk be diversified away by investing in both GlobalData PLC and Inspiration Healthcare 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 GlobalData PLC and Inspiration Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GlobalData PLC and Inspiration Healthcare Group, you can compare the effects of market volatilities on GlobalData PLC and Inspiration Healthcare 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 GlobalData PLC with a short position of Inspiration Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlobalData PLC and Inspiration Healthcare.

Diversification Opportunities for GlobalData PLC and Inspiration Healthcare

-0.35

Correlation Coefficient

GlobalData PLC  Inspiration Healthcare

Very good diversification

The 3 months correlation between GlobalData and Inspiration is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding GlobalData PLC and Inspiration Healthcare Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspiration Healthcare and GlobalData PLC 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 GlobalData PLC are associated (or correlated) with Inspiration Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspiration Healthcare has no effect on the direction of GlobalData PLC i.e., GlobalData PLC and Inspiration Healthcare go up and down completely randomly.

Pair Corralation between GlobalData PLC and Inspiration Healthcare

Assuming the 90 days trading horizon GlobalData PLC is expected to generate 22.14 times less return on investment than Inspiration Healthcare. In addition to that, GlobalData PLC is 1.46 times more volatile than Inspiration Healthcare Group. It trades about 0.0 of its total potential returns per unit of risk. Inspiration Healthcare Group is currently generating about 0.12 per unit of volatility. If you would invest  1,725  in Inspiration Healthcare Group on April 24, 2025 and sell it today you would earn a total of  425.00  from holding Inspiration Healthcare Group or generate 24.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

GlobalData PLC  vs.  Inspiration Healthcare Group

GlobalData PLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days GlobalData PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, GlobalData PLC is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Inspiration Healthcare

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Inspiration Healthcare Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Inspiration Healthcare exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GlobalData PLC and Inspiration Healthcare

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

The idea behind GlobalData PLC and Inspiration Healthcare Group 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.