Correlation Between Eventide Healthcare and Americafirst Large
Can any of the company-specific risk be diversified away by investing in both Eventide Healthcare and Americafirst Large 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 Eventide Healthcare and Americafirst Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eventide Healthcare Life and Americafirst Large Cap, you can compare the effects of market volatilities on Eventide Healthcare and Americafirst Large 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 Eventide Healthcare with a short position of Americafirst Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eventide Healthcare and Americafirst Large.
Diversification Opportunities for Eventide Healthcare and Americafirst Large
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Eventide and Americafirst is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Eventide Healthcare Life and Americafirst Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americafirst Large Cap and Eventide 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 Eventide Healthcare Life are associated (or correlated) with Americafirst Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americafirst Large Cap has no effect on the direction of Eventide Healthcare i.e., Eventide Healthcare and Americafirst Large go up and down completely randomly.
Pair Corralation between Eventide Healthcare and Americafirst Large
Assuming the 90 days horizon Eventide Healthcare is expected to generate 5.25 times less return on investment than Americafirst Large. In addition to that, Eventide Healthcare is 1.66 times more volatile than Americafirst Large Cap. It trades about 0.01 of its total potential returns per unit of risk. Americafirst Large Cap is currently generating about 0.07 per unit of volatility. If you would invest 1,039 in Americafirst Large Cap on September 25, 2024 and sell it today you would earn a total of 341.00 from holding Americafirst Large Cap or generate 32.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eventide Healthcare Life vs. Americafirst Large Cap
Performance |
| Timeline |
| Eventide Healthcare Life |
| Americafirst Large Cap |
Eventide Healthcare and Americafirst Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eventide Healthcare and Americafirst Large
The main advantage of trading using opposite Eventide Healthcare and Americafirst Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eventide Healthcare position performs unexpectedly, Americafirst Large 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 Americafirst Large will offset losses from the drop in Americafirst Large's long position.| Eventide Healthcare vs. Eventide Gilead Fund | Eventide Healthcare vs. Morgan Stanley Multi | Eventide Healthcare vs. Berkshire Focus | Eventide Healthcare vs. Eventide Gilead Fund |
| Americafirst Large vs. Americafirst Large Cap | Americafirst Large vs. Americafirst Monthly Risk On | Americafirst Large vs. Americafirst Tactical Alpha | Americafirst Large vs. Americafirst Tactical Alpha |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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