Correlation Between Spire Healthcare and Worldwide Healthcare

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

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

Diversification Opportunities for Spire Healthcare and Worldwide Healthcare

0.83

Correlation Coefficient

Spire Healthcare  Worldwide Healthcare

Very poor diversification

The 3 months correlation between Spire and Worldwide is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Spire Healthcare Group and Worldwide Healthcare Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldwide Healthcare and Spire Healthcare 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 Spire Healthcare Group are associated (or correlated) with Worldwide Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldwide Healthcare has no effect on the direction of Spire Healthcare i.e., Spire Healthcare and Worldwide Healthcare go up and down completely randomly.

Pair Corralation between Spire Healthcare and Worldwide Healthcare

Assuming the 90 days trading horizon Spire Healthcare Group is expected to generate 1.44 times more return on investment than Worldwide Healthcare. However, Spire Healthcare is 1.44 times more volatile than Worldwide Healthcare Trust. It trades about 0.24 of its potential returns per unit of risk. Worldwide Healthcare Trust is currently generating about 0.15 per unit of risk. If you would invest  18,284  in Spire Healthcare Group on April 24, 2025 and sell it today you would earn a total of  4,216  from holding Spire Healthcare Group or generate 23.06% return on investment over 90 days.

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

Spire Healthcare Group  vs.  Worldwide Healthcare Trust

Spire Healthcare

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Spire Healthcare Group are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Spire Healthcare exhibited solid returns over the last few months and may actually be approaching a breakup point.

Worldwide Healthcare

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Worldwide Healthcare Trust are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Worldwide Healthcare may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Spire Healthcare and Worldwide Healthcare

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

The idea behind Spire Healthcare Group and Worldwide 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.