Correlation Between EGF Theramed and Healthcare Triangle
Can any of the company-specific risk be diversified away by investing in both EGF Theramed and Healthcare Triangle 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 EGF Theramed and Healthcare Triangle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EGF Theramed Health and Healthcare Triangle, you can compare the effects of market volatilities on EGF Theramed and Healthcare Triangle 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 EGF Theramed with a short position of Healthcare Triangle. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGF Theramed and Healthcare Triangle.
Diversification Opportunities for EGF Theramed and Healthcare Triangle
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between EGF and Healthcare is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding EGF Theramed Health and Healthcare Triangle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthcare Triangle and EGF Theramed 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 EGF Theramed Health are associated (or correlated) with Healthcare Triangle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthcare Triangle has no effect on the direction of EGF Theramed i.e., EGF Theramed and Healthcare Triangle go up and down completely randomly.
Pair Corralation between EGF Theramed and Healthcare Triangle
Assuming the 90 days horizon EGF Theramed Health is expected to generate 9.08 times more return on investment than Healthcare Triangle. However, EGF Theramed is 9.08 times more volatile than Healthcare Triangle. It trades about 0.27 of its potential returns per unit of risk. Healthcare Triangle is currently generating about -0.2 per unit of risk. If you would invest 5.70 in EGF Theramed Health on August 27, 2024 and sell it today you would earn a total of 15.30 from holding EGF Theramed Health or generate 268.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EGF Theramed Health vs. Healthcare Triangle
Performance |
| Timeline |
| EGF Theramed Health |
| Healthcare Triangle |
EGF Theramed and Healthcare Triangle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGF Theramed and Healthcare Triangle
The main advantage of trading using opposite EGF Theramed and Healthcare Triangle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGF Theramed position performs unexpectedly, Healthcare Triangle 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 Healthcare Triangle will offset losses from the drop in Healthcare Triangle's long position.| EGF Theramed vs. GE HealthCare Technologies | EGF Theramed vs. Veeva Systems Class | EGF Theramed vs. Solventum Corp | EGF Theramed vs. HealthEquity |
| Healthcare Triangle vs. Bullfrog AI Holdings, | Healthcare Triangle vs. EUDA Health Holdings | Healthcare Triangle vs. Mangoceuticals, Common Stock | Healthcare Triangle vs. FOXO Technologies |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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