Correlation Between INTEL CDR and DRI Healthcare

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

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

Diversification Opportunities for INTEL CDR and DRI Healthcare

0.7

Correlation Coefficient

INTEL CDR  DRI Healthcare

Poor diversification

The 3 months correlation between INTEL and DRI is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding INTEL CDR and DRI Healthcare Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DRI Healthcare Trust and INTEL CDR 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 INTEL CDR are associated (or correlated) with DRI Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DRI Healthcare Trust has no effect on the direction of INTEL CDR i.e., INTEL CDR and DRI Healthcare go up and down completely randomly.

Pair Corralation between INTEL CDR and DRI Healthcare

Assuming the 90 days trading horizon INTEL CDR is expected to generate 1.52 times less return on investment than DRI Healthcare. In addition to that, INTEL CDR is 2.0 times more volatile than DRI Healthcare Trust. It trades about 0.11 of its total potential returns per unit of risk. DRI Healthcare Trust is currently generating about 0.34 per unit of volatility. If you would invest  1,074  in DRI Healthcare Trust on April 22, 2025 and sell it today you would earn a total of  353.00  from holding DRI Healthcare Trust or generate 32.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

INTEL CDR  vs.  DRI Healthcare Trust

INTEL CDR

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in INTEL CDR are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather abnormal technical and fundamental indicators, INTEL CDR exhibited solid returns over the last few months and may actually be approaching a breakup point.

DRI Healthcare Trust

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in DRI Healthcare Trust are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating basic indicators, DRI Healthcare sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with INTEL CDR and DRI Healthcare

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

The idea behind INTEL CDR and DRI Healthcare Trust 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.