Correlation Between COLUMBIA SPORTSWEAR and Acadia Healthcare
Can any of the company-specific risk be diversified away by investing in both COLUMBIA SPORTSWEAR and Acadia 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 COLUMBIA SPORTSWEAR and Acadia Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COLUMBIA SPORTSWEAR and Acadia Healthcare, you can compare the effects of market volatilities on COLUMBIA SPORTSWEAR and Acadia 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 COLUMBIA SPORTSWEAR with a short position of Acadia Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of COLUMBIA SPORTSWEAR and Acadia Healthcare.
Diversification Opportunities for COLUMBIA SPORTSWEAR and Acadia Healthcare
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between COLUMBIA and Acadia is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding COLUMBIA SPORTSWEAR and Acadia Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadia Healthcare and COLUMBIA SPORTSWEAR 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 COLUMBIA SPORTSWEAR are associated (or correlated) with Acadia Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadia Healthcare has no effect on the direction of COLUMBIA SPORTSWEAR i.e., COLUMBIA SPORTSWEAR and Acadia Healthcare go up and down completely randomly.
Pair Corralation between COLUMBIA SPORTSWEAR and Acadia Healthcare
Assuming the 90 days trading horizon COLUMBIA SPORTSWEAR is expected to generate 0.35 times more return on investment than Acadia Healthcare. However, COLUMBIA SPORTSWEAR is 2.83 times less risky than Acadia Healthcare. It trades about 0.01 of its potential returns per unit of risk. Acadia Healthcare is currently generating about -0.05 per unit of risk. If you would invest 4,515 in COLUMBIA SPORTSWEAR on August 16, 2025 and sell it today you would earn a total of 25.00 from holding COLUMBIA SPORTSWEAR or generate 0.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COLUMBIA SPORTSWEAR vs. Acadia Healthcare
Performance |
| Timeline |
| COLUMBIA SPORTSWEAR |
| Acadia Healthcare |
COLUMBIA SPORTSWEAR and Acadia Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COLUMBIA SPORTSWEAR and Acadia Healthcare
The main advantage of trading using opposite COLUMBIA SPORTSWEAR and Acadia Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COLUMBIA SPORTSWEAR position performs unexpectedly, Acadia 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 Acadia Healthcare will offset losses from the drop in Acadia Healthcare's long position.| COLUMBIA SPORTSWEAR vs. Apple Inc | COLUMBIA SPORTSWEAR vs. Apple Inc | COLUMBIA SPORTSWEAR vs. Apple Inc | COLUMBIA SPORTSWEAR vs. Apple Inc |
| Acadia Healthcare vs. Fresenius Medical Care | Acadia Healthcare vs. SIVERS SEMICONDUCTORS AB | Acadia Healthcare vs. BANK HANDLOWY | Acadia Healthcare vs. Reliance Steel Aluminum |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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