Correlation Between EPSILON HEALTHCARE and Treasury Wine
Can any of the company-specific risk be diversified away by investing in both EPSILON HEALTHCARE and Treasury Wine 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 EPSILON HEALTHCARE and Treasury Wine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EPSILON HEALTHCARE LTD and Treasury Wine Estates, you can compare the effects of market volatilities on EPSILON HEALTHCARE and Treasury Wine 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 EPSILON HEALTHCARE with a short position of Treasury Wine. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPSILON HEALTHCARE and Treasury Wine.
Diversification Opportunities for EPSILON HEALTHCARE and Treasury Wine
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EPSILON and Treasury is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EPSILON HEALTHCARE LTD and Treasury Wine Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Treasury Wine Estates and EPSILON HEALTHCARE 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 EPSILON HEALTHCARE LTD are associated (or correlated) with Treasury Wine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Treasury Wine Estates has no effect on the direction of EPSILON HEALTHCARE i.e., EPSILON HEALTHCARE and Treasury Wine go up and down completely randomly.
Pair Corralation between EPSILON HEALTHCARE and Treasury Wine
Assuming the 90 days trading horizon EPSILON HEALTHCARE LTD is expected to under-perform the Treasury Wine. But the stock apears to be less risky and, when comparing its historical volatility, EPSILON HEALTHCARE LTD is 1.45 times less risky than Treasury Wine. The stock trades about -0.03 of its potential returns per unit of risk. The Treasury Wine Estates is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 599.00 in Treasury Wine Estates on September 4, 2024 and sell it today you would earn a total of 93.00 from holding Treasury Wine Estates or generate 15.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
EPSILON HEALTHCARE LTD vs. Treasury Wine Estates
Performance |
| Timeline |
| EPSILON HEALTHCARE LTD |
| Treasury Wine Estates |
EPSILON HEALTHCARE and Treasury Wine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EPSILON HEALTHCARE and Treasury Wine
The main advantage of trading using opposite EPSILON HEALTHCARE and Treasury Wine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPSILON HEALTHCARE position performs unexpectedly, Treasury Wine 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 Treasury Wine will offset losses from the drop in Treasury Wine's long position.| EPSILON HEALTHCARE vs. Takeda Pharmaceutical | EPSILON HEALTHCARE vs. Elanco Animal Health | EPSILON HEALTHCARE vs. Superior Plus Corp | EPSILON HEALTHCARE vs. Origin Agritech |
| Treasury Wine vs. Tsingtao Brewery | Treasury Wine vs. BLUESCOPE STEEL | Treasury Wine vs. Fevertree Drinks PLC | Treasury Wine vs. EHEALTH |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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