Correlation Between Electromed and P3 Health
Can any of the company-specific risk be diversified away by investing in both Electromed and P3 Health 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 Electromed and P3 Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Electromed and P3 Health Partners, you can compare the effects of market volatilities on Electromed and P3 Health 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 Electromed with a short position of P3 Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Electromed and P3 Health.
Diversification Opportunities for Electromed and P3 Health
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Electromed and PIIIW is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Electromed and P3 Health Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on P3 Health Partners and Electromed 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 Electromed are associated (or correlated) with P3 Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of P3 Health Partners has no effect on the direction of Electromed i.e., Electromed and P3 Health go up and down completely randomly.
Pair Corralation between Electromed and P3 Health
Given the investment horizon of 90 days Electromed is expected to generate 66.02 times less return on investment than P3 Health. But when comparing it to its historical volatility, Electromed is 76.09 times less risky than P3 Health. It trades about 0.22 of its potential returns per unit of risk. P3 Health Partners is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 5.48 in P3 Health Partners on September 3, 2024 and sell it today you would lose (4.40) from holding P3 Health Partners or give up 80.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 50.4% |
| Values | Daily Returns |
Electromed vs. P3 Health Partners
Performance |
| Timeline |
| Electromed |
| P3 Health Partners |
Electromed and P3 Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Electromed and P3 Health
The main advantage of trading using opposite Electromed and P3 Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Electromed position performs unexpectedly, P3 Health 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 P3 Health will offset losses from the drop in P3 Health's long position.| Electromed vs. Tandem Diabetes Care | Electromed vs. Inspire Medical Systems | Electromed vs. Penumbra | Electromed vs. Insulet |
| P3 Health vs. Select Medical Holdings | P3 Health vs. Encompass Health Corp | P3 Health vs. Pennant Group | P3 Health vs. InnovAge Holding Corp |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |