Correlation Between EMvision Medical and Hansen Technologies
Can any of the company-specific risk be diversified away by investing in both EMvision Medical and Hansen Technologies 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 EMvision Medical and Hansen Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EMvision Medical Devices and Hansen Technologies, you can compare the effects of market volatilities on EMvision Medical and Hansen Technologies 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 EMvision Medical with a short position of Hansen Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMvision Medical and Hansen Technologies.
Diversification Opportunities for EMvision Medical and Hansen Technologies
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EMvision and Hansen is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding EMvision Medical Devices and Hansen Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hansen Technologies and EMvision Medical 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 EMvision Medical Devices are associated (or correlated) with Hansen Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hansen Technologies has no effect on the direction of EMvision Medical i.e., EMvision Medical and Hansen Technologies go up and down completely randomly.
Pair Corralation between EMvision Medical and Hansen Technologies
Assuming the 90 days trading horizon EMvision Medical Devices is expected to under-perform the Hansen Technologies. In addition to that, EMvision Medical is 1.56 times more volatile than Hansen Technologies. It trades about -0.05 of its total potential returns per unit of risk. Hansen Technologies is currently generating about -0.03 per unit of volatility. If you would invest 547.00 in Hansen Technologies on September 19, 2024 and sell it today you would lose (9.00) from holding Hansen Technologies or give up 1.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EMvision Medical Devices vs. Hansen Technologies
Performance |
| Timeline |
| EMvision Medical Devices |
| Hansen Technologies |
EMvision Medical and Hansen Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMvision Medical and Hansen Technologies
The main advantage of trading using opposite EMvision Medical and Hansen Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMvision Medical position performs unexpectedly, Hansen Technologies 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 Hansen Technologies will offset losses from the drop in Hansen Technologies' long position.| EMvision Medical vs. Perseus Mining | EMvision Medical vs. Alto Metals | EMvision Medical vs. Hutchison Telecommunications | EMvision Medical vs. Dexus Convenience Retail |
| Hansen Technologies vs. Neurotech International | Hansen Technologies vs. Centaurus Metals | Hansen Technologies vs. RLF AgTech | Hansen Technologies vs. Catalyst Metals |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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