Correlation Between PennyMac Finl and Addus HomeCare
Can any of the company-specific risk be diversified away by investing in both PennyMac Finl and Addus HomeCare 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 PennyMac Finl and Addus HomeCare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PennyMac Finl Svcs and Addus HomeCare, you can compare the effects of market volatilities on PennyMac Finl and Addus HomeCare 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 PennyMac Finl with a short position of Addus HomeCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of PennyMac Finl and Addus HomeCare.
Diversification Opportunities for PennyMac Finl and Addus HomeCare
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PennyMac and Addus is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding PennyMac Finl Svcs and Addus HomeCare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Addus HomeCare and PennyMac Finl 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 PennyMac Finl Svcs are associated (or correlated) with Addus HomeCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Addus HomeCare has no effect on the direction of PennyMac Finl i.e., PennyMac Finl and Addus HomeCare go up and down completely randomly.
Pair Corralation between PennyMac Finl and Addus HomeCare
Given the investment horizon of 90 days PennyMac Finl Svcs is expected to generate 0.93 times more return on investment than Addus HomeCare. However, PennyMac Finl Svcs is 1.07 times less risky than Addus HomeCare. It trades about 0.16 of its potential returns per unit of risk. Addus HomeCare is currently generating about 0.06 per unit of risk. If you would invest 11,256 in PennyMac Finl Svcs on September 3, 2025 and sell it today you would earn a total of 2,153 from holding PennyMac Finl Svcs or generate 19.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PennyMac Finl Svcs vs. Addus HomeCare
Performance |
| Timeline |
| PennyMac Finl Svcs |
| Addus HomeCare |
PennyMac Finl and Addus HomeCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PennyMac Finl and Addus HomeCare
The main advantage of trading using opposite PennyMac Finl and Addus HomeCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PennyMac Finl position performs unexpectedly, Addus HomeCare 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 Addus HomeCare will offset losses from the drop in Addus HomeCare's long position.| PennyMac Finl vs. Addus HomeCare | PennyMac Finl vs. Bassett Furniture Industries | PennyMac Finl vs. City Office REIT | PennyMac Finl vs. Beazer Homes USA |
| Addus HomeCare vs. E Home Household Service | Addus HomeCare vs. Kingdee International Software | Addus HomeCare vs. World Houseware Limited | Addus HomeCare vs. NETCLASS TECHNOLOGY INC |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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