Correlation Between FIRST SAVINGS and Edwards Lifesciences
Can any of the company-specific risk be diversified away by investing in both FIRST SAVINGS and Edwards Lifesciences 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 FIRST SAVINGS and Edwards Lifesciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIRST SAVINGS FINL and Edwards Lifesciences, you can compare the effects of market volatilities on FIRST SAVINGS and Edwards Lifesciences 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 FIRST SAVINGS with a short position of Edwards Lifesciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST SAVINGS and Edwards Lifesciences.
Diversification Opportunities for FIRST SAVINGS and Edwards Lifesciences
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FIRST and Edwards is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding FIRST SAVINGS FINL and Edwards Lifesciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edwards Lifesciences and FIRST SAVINGS 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 FIRST SAVINGS FINL are associated (or correlated) with Edwards Lifesciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edwards Lifesciences has no effect on the direction of FIRST SAVINGS i.e., FIRST SAVINGS and Edwards Lifesciences go up and down completely randomly.
Pair Corralation between FIRST SAVINGS and Edwards Lifesciences
Assuming the 90 days horizon FIRST SAVINGS FINL is expected to generate 0.92 times more return on investment than Edwards Lifesciences. However, FIRST SAVINGS FINL is 1.08 times less risky than Edwards Lifesciences. It trades about 0.04 of its potential returns per unit of risk. Edwards Lifesciences is currently generating about 0.01 per unit of risk. If you would invest 1,687 in FIRST SAVINGS FINL on October 14, 2024 and sell it today you would earn a total of 633.00 from holding FIRST SAVINGS FINL or generate 37.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FIRST SAVINGS FINL vs. Edwards Lifesciences
Performance |
| Timeline |
| FIRST SAVINGS FINL |
| Edwards Lifesciences |
FIRST SAVINGS and Edwards Lifesciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIRST SAVINGS and Edwards Lifesciences
The main advantage of trading using opposite FIRST SAVINGS and Edwards Lifesciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST SAVINGS position performs unexpectedly, Edwards Lifesciences 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 Edwards Lifesciences will offset losses from the drop in Edwards Lifesciences' long position.| FIRST SAVINGS vs. POSBO UNSPADRS20YC1 | FIRST SAVINGS vs. Postal Savings Bank | FIRST SAVINGS vs. Truist Financial | FIRST SAVINGS vs. OVERSEA CHINUNSPADR2 |
| Edwards Lifesciences vs. Guangdong Investment Limited | Edwards Lifesciences vs. FIRST SAVINGS FINL | Edwards Lifesciences vs. PennantPark Investment | Edwards Lifesciences vs. AOYAMA TRADING |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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