Correlation Between IMS Health and Protective Life
Can any of the company-specific risk be diversified away by investing in both IMS Health and Protective Life 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 IMS Health and Protective Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IMS Health Holdings and Protective Life Dynamic, you can compare the effects of market volatilities on IMS Health and Protective Life 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 IMS Health with a short position of Protective Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of IMS Health and Protective Life.
Diversification Opportunities for IMS Health and Protective Life
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IMS and Protective is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding IMS Health Holdings and Protective Life Dynamic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protective Life Dynamic and IMS 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 IMS Health Holdings are associated (or correlated) with Protective Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protective Life Dynamic has no effect on the direction of IMS Health i.e., IMS Health and Protective Life go up and down completely randomly.
Pair Corralation between IMS Health and Protective Life
If you would invest (100.00) in Protective Life Dynamic on January 19, 2024 and sell it today you would earn a total of 100.00 from holding Protective Life Dynamic or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IMS Health Holdings vs. Protective Life Dynamic
Performance |
| Timeline |
| IMS Health Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Protective Life Dynamic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
IMS Health and Protective Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IMS Health and Protective Life
The main advantage of trading using opposite IMS Health and Protective Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IMS Health position performs unexpectedly, Protective Life 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 Protective Life will offset losses from the drop in Protective Life's long position.| IMS Health vs. Marine Products | IMS Health vs. Aptiv PLC | IMS Health vs. Wallbox NV | IMS Health vs. Modine Manufacturing |
| Protective Life vs. Prudential Jennison International | Protective Life vs. Fidelity New Markets | Protective Life vs. Ohio Variable College |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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