Correlation Between EDAP TMS and Teladoc
Can any of the company-specific risk be diversified away by investing in both EDAP TMS and Teladoc 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 EDAP TMS and Teladoc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EDAP TMS SA and Teladoc, you can compare the effects of market volatilities on EDAP TMS and Teladoc 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 EDAP TMS with a short position of Teladoc. Check out your portfolio center. Please also check ongoing floating volatility patterns of EDAP TMS and Teladoc.
Diversification Opportunities for EDAP TMS and Teladoc
Very weak diversification
The 3 months correlation between EDAP and Teladoc is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding EDAP TMS SA and Teladoc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teladoc and EDAP TMS 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 EDAP TMS SA are associated (or correlated) with Teladoc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teladoc has no effect on the direction of EDAP TMS i.e., EDAP TMS and Teladoc go up and down completely randomly.
Pair Corralation between EDAP TMS and Teladoc
Given the investment horizon of 90 days EDAP TMS is expected to generate 1.66 times less return on investment than Teladoc. But when comparing it to its historical volatility, EDAP TMS SA is 1.27 times less risky than Teladoc. It trades about 0.43 of its potential returns per unit of risk. Teladoc is currently generating about 0.55 of returns per unit of risk over similar time horizon. If you would invest 909.00 in Teladoc on November 18, 2024 and sell it today you would earn a total of 524.00 from holding Teladoc or generate 57.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EDAP TMS SA vs. Teladoc
Performance |
| Timeline |
| EDAP TMS SA |
| Teladoc |
EDAP TMS and Teladoc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EDAP TMS and Teladoc
The main advantage of trading using opposite EDAP TMS and Teladoc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EDAP TMS position performs unexpectedly, Teladoc 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 Teladoc will offset losses from the drop in Teladoc's long position.| EDAP TMS vs. Patterson Companies | EDAP TMS vs. Henry Schein | EDAP TMS vs. McKesson | EDAP TMS vs. Cardinal Health |
| Teladoc vs. Veeva Systems Class | Teladoc vs. 10X Genomics | Teladoc vs. GE HealthCare Technologies | Teladoc 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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