Correlation Between Sienna Senior and Extendicare
Can any of the company-specific risk be diversified away by investing in both Sienna Senior and Extendicare 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 Sienna Senior and Extendicare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sienna Senior Living and Extendicare, you can compare the effects of market volatilities on Sienna Senior and Extendicare 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 Sienna Senior with a short position of Extendicare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sienna Senior and Extendicare.
Diversification Opportunities for Sienna Senior and Extendicare
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sienna and Extendicare is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Sienna Senior Living and Extendicare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Extendicare and Sienna Senior 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 Sienna Senior Living are associated (or correlated) with Extendicare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Extendicare has no effect on the direction of Sienna Senior i.e., Sienna Senior and Extendicare go up and down completely randomly.
Pair Corralation between Sienna Senior and Extendicare
Assuming the 90 days trading horizon Sienna Senior Living is expected to generate 0.85 times more return on investment than Extendicare. However, Sienna Senior Living is 1.18 times less risky than Extendicare. It trades about 0.16 of its potential returns per unit of risk. Extendicare is currently generating about 0.06 per unit of risk. If you would invest 1,309 in Sienna Senior Living on March 7, 2024 and sell it today you would earn a total of 149.00 from holding Sienna Senior Living or generate 11.38% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Sienna Senior Living vs. Extendicare
Performance |
Timeline |
Sienna Senior Living |
Extendicare |
Sienna Senior and Extendicare Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sienna Senior and Extendicare
The main advantage of trading using opposite Sienna Senior and Extendicare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sienna Senior position performs unexpectedly, Extendicare 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 Extendicare will offset losses from the drop in Extendicare's long position.Sienna Senior vs. VentriPoint Diagnostics | Sienna Senior vs. Sirona Biochem Corp | Sienna Senior vs. iShares Canadian HYBrid | Sienna Senior vs. Solar Alliance Energy |
Extendicare vs. VentriPoint Diagnostics | Extendicare vs. Sirona Biochem Corp | Extendicare vs. iShares Canadian HYBrid | Extendicare vs. Solar Alliance Energy |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Share Portfolio Track or share privately all of your investments from the convenience of any device |