Correlation Between Doximity and GE HealthCare
Can any of the company-specific risk be diversified away by investing in both Doximity and GE HealthCare 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 Doximity and GE HealthCare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doximity and GE HealthCare Technologies, you can compare the effects of market volatilities on Doximity and GE HealthCare 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 Doximity with a short position of GE HealthCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doximity and GE HealthCare.
Diversification Opportunities for Doximity and GE HealthCare
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Doximity and GEHC is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Doximity and GE HealthCare Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE HealthCare Techno and Doximity 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 Doximity are associated (or correlated) with GE HealthCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE HealthCare Techno has no effect on the direction of Doximity i.e., Doximity and GE HealthCare go up and down completely randomly.
Pair Corralation between Doximity and GE HealthCare
Given the investment horizon of 90 days Doximity is expected to generate 1.95 times more return on investment than GE HealthCare. However, Doximity is 1.95 times more volatile than GE HealthCare Technologies. It trades about 0.03 of its potential returns per unit of risk. GE HealthCare Technologies is currently generating about 0.04 per unit of risk. If you would invest 3,538 in Doximity on August 24, 2024 and sell it today you would earn a total of 1,282 from holding Doximity or generate 36.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Doximity vs. GE HealthCare Technologies
Performance |
| Timeline |
| Doximity |
| GE HealthCare Techno |
Doximity and GE HealthCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doximity and GE HealthCare
The main advantage of trading using opposite Doximity and GE HealthCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doximity position performs unexpectedly, GE HealthCare 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 GE HealthCare will offset losses from the drop in GE HealthCare's long position.The idea behind Doximity and GE HealthCare Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| GE HealthCare vs. Teladoc | GE HealthCare vs. Veeva Systems Class | GE HealthCare vs. 10X Genomics | GE HealthCare vs. Progyny |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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