Correlation Between RLX TECH and Healthequity
Can any of the company-specific risk be diversified away by investing in both RLX TECH and Healthequity 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 RLX TECH and Healthequity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RLX TECH SPADR1 and Healthequity, you can compare the effects of market volatilities on RLX TECH and Healthequity 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 RLX TECH with a short position of Healthequity. Check out your portfolio center. Please also check ongoing floating volatility patterns of RLX TECH and Healthequity.
Diversification Opportunities for RLX TECH and Healthequity
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between RLX and Healthequity is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding RLX TECH SPADR1 and Healthequity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthequity and RLX TECH 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 RLX TECH SPADR1 are associated (or correlated) with Healthequity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthequity has no effect on the direction of RLX TECH i.e., RLX TECH and Healthequity go up and down completely randomly.
Pair Corralation between RLX TECH and Healthequity
Assuming the 90 days horizon RLX TECH SPADR1 is expected to generate 0.68 times more return on investment than Healthequity. However, RLX TECH SPADR1 is 1.47 times less risky than Healthequity. It trades about 0.5 of its potential returns per unit of risk. Healthequity is currently generating about 0.3 per unit of risk. If you would invest 146.00 in RLX TECH SPADR1 on September 3, 2024 and sell it today you would earn a total of 39.00 from holding RLX TECH SPADR1 or generate 26.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
RLX TECH SPADR1 vs. Healthequity
Performance |
| Timeline |
| RLX TECH SPADR1 |
| Healthequity |
RLX TECH and Healthequity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RLX TECH and Healthequity
The main advantage of trading using opposite RLX TECH and Healthequity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RLX TECH position performs unexpectedly, Healthequity 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 Healthequity will offset losses from the drop in Healthequity's long position.| RLX TECH vs. Alaska Air Group | RLX TECH vs. MOVIE GAMES SA | RLX TECH vs. Apollo Investment Corp | RLX TECH vs. PennyMac Mortgage Investment |
| Healthequity vs. 10X GENOMICS DL | Healthequity vs. Teladoc | Healthequity vs. Evolent Health | Healthequity vs. RLX TECH SPADR1 |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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