Correlation Between USWE SPORTS and EHEALTH
Can any of the company-specific risk be diversified away by investing in both USWE SPORTS and EHEALTH 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 USWE SPORTS and EHEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USWE SPORTS AB and EHEALTH, you can compare the effects of market volatilities on USWE SPORTS and EHEALTH 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 USWE SPORTS with a short position of EHEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of USWE SPORTS and EHEALTH.
Diversification Opportunities for USWE SPORTS and EHEALTH
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between USWE and EHEALTH is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding USWE SPORTS AB and EHEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EHEALTH and USWE SPORTS 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 USWE SPORTS AB are associated (or correlated) with EHEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EHEALTH has no effect on the direction of USWE SPORTS i.e., USWE SPORTS and EHEALTH go up and down completely randomly.
Pair Corralation between USWE SPORTS and EHEALTH
Assuming the 90 days horizon USWE SPORTS AB is expected to under-perform the EHEALTH. But the stock apears to be less risky and, when comparing its historical volatility, USWE SPORTS AB is 1.1 times less risky than EHEALTH. The stock trades about -0.06 of its potential returns per unit of risk. The EHEALTH is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 946.00 in EHEALTH on November 29, 2024 and sell it today you would lose (40.00) from holding EHEALTH or give up 4.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
USWE SPORTS AB vs. EHEALTH
Performance |
| Timeline |
| USWE SPORTS AB |
| EHEALTH |
USWE SPORTS and EHEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USWE SPORTS and EHEALTH
The main advantage of trading using opposite USWE SPORTS and EHEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USWE SPORTS position performs unexpectedly, EHEALTH 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 EHEALTH will offset losses from the drop in EHEALTH's long position.| USWE SPORTS vs. CAREER EDUCATION | USWE SPORTS vs. Grand Canyon Education | USWE SPORTS vs. DeVry Education Group | USWE SPORTS vs. VITEC SOFTWARE GROUP |
| EHEALTH vs. 24SEVENOFFICE GROUP AB | EHEALTH vs. KENEDIX OFFICE INV | EHEALTH vs. Phibro Animal Health | EHEALTH vs. OPKO HEALTH |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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