Correlation Between EGF Theramed and So Young
Can any of the company-specific risk be diversified away by investing in both EGF Theramed and So Young 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 So Young 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 So Young International, you can compare the effects of market volatilities on EGF Theramed and So Young 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 So Young. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGF Theramed and So Young.
Diversification Opportunities for EGF Theramed and So Young
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EGF and So Young is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding EGF Theramed Health and So Young International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on So Young International 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 So Young. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of So Young International has no effect on the direction of EGF Theramed i.e., EGF Theramed and So Young go up and down completely randomly.
Pair Corralation between EGF Theramed and So Young
Assuming the 90 days horizon EGF Theramed Health is expected to generate 12.27 times more return on investment than So Young. However, EGF Theramed is 12.27 times more volatile than So Young International. It trades about 0.1 of its potential returns per unit of risk. So Young International is currently generating about -0.02 per unit of risk. If you would invest 7.80 in EGF Theramed Health on September 1, 2024 and sell it today you would earn a total of 14.20 from holding EGF Theramed Health or generate 182.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EGF Theramed Health vs. So Young International
Performance |
| Timeline |
| EGF Theramed Health |
| So Young International |
EGF Theramed and So Young Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGF Theramed and So Young
The main advantage of trading using opposite EGF Theramed and So Young positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGF Theramed position performs unexpectedly, So Young 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 So Young will offset losses from the drop in So Young's long position.| EGF Theramed vs. GE HealthCare Technologies | EGF Theramed vs. Veeva Systems Class | EGF Theramed vs. Solventum Corp | EGF Theramed vs. Doximity |
| So Young vs. National Research Corp | So Young vs. Definitive Healthcare Corp | So Young vs. HealthStream | So Young vs. Streamline Health Solutions |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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