Correlation Between EPlay Digital and CVS Health
Can any of the company-specific risk be diversified away by investing in both EPlay Digital and CVS Health 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 EPlay Digital and CVS Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ePlay Digital and CVS Health, you can compare the effects of market volatilities on EPlay Digital and CVS Health 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 EPlay Digital with a short position of CVS Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPlay Digital and CVS Health.
Diversification Opportunities for EPlay Digital and CVS Health
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EPlay and CVS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ePlay Digital and CVS Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVS Health and EPlay Digital 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 ePlay Digital are associated (or correlated) with CVS Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVS Health has no effect on the direction of EPlay Digital i.e., EPlay Digital and CVS Health go up and down completely randomly.
Pair Corralation between EPlay Digital and CVS Health
Assuming the 90 days trading horizon ePlay Digital is expected to generate 28.68 times more return on investment than CVS Health. However, EPlay Digital is 28.68 times more volatile than CVS Health. It trades about 0.08 of its potential returns per unit of risk. CVS Health is currently generating about 0.04 per unit of risk. If you would invest 0.10 in ePlay Digital on November 28, 2024 and sell it today you would earn a total of 0.00 from holding ePlay Digital or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ePlay Digital vs. CVS Health
Performance |
| Timeline |
| ePlay Digital |
| CVS Health |
EPlay Digital and CVS Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EPlay Digital and CVS Health
The main advantage of trading using opposite EPlay Digital and CVS Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPlay Digital position performs unexpectedly, CVS Health 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 CVS Health will offset losses from the drop in CVS Health's long position.| EPlay Digital vs. Tencent Music Entertainment | EPlay Digital vs. PROSIEBENSAT1 MEDIADR4 | EPlay Digital vs. Singapore Telecommunications Limited | EPlay Digital vs. CNVISION MEDIA |
| CVS Health vs. CHRYSALIS INVESTMENTS LTD | CVS Health vs. Stag Industrial | CVS Health vs. SIERRA METALS | CVS Health vs. Yunnan Water Investment |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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