Correlation Between Evolent Health and Electrocore LLC
Can any of the company-specific risk be diversified away by investing in both Evolent Health and Electrocore LLC 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 Evolent Health and Electrocore LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolent Health and Electrocore LLC, you can compare the effects of market volatilities on Evolent Health and Electrocore LLC 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 Evolent Health with a short position of Electrocore LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolent Health and Electrocore LLC.
Diversification Opportunities for Evolent Health and Electrocore LLC
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Evolent and Electrocore is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Evolent Health and Electrocore LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electrocore LLC and Evolent Health 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 Evolent Health are associated (or correlated) with Electrocore LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electrocore LLC has no effect on the direction of Evolent Health i.e., Evolent Health and Electrocore LLC go up and down completely randomly.
Pair Corralation between Evolent Health and Electrocore LLC
Considering the 90-day investment horizon Evolent Health is expected to under-perform the Electrocore LLC. In addition to that, Evolent Health is 1.52 times more volatile than Electrocore LLC. It trades about -0.21 of its total potential returns per unit of risk. Electrocore LLC is currently generating about 0.05 per unit of volatility. If you would invest 1,105 in Electrocore LLC on August 28, 2024 and sell it today you would earn a total of 30.00 from holding Electrocore LLC or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolent Health vs. Electrocore LLC
Performance |
| Timeline |
| Evolent Health |
| Electrocore LLC |
Evolent Health and Electrocore LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolent Health and Electrocore LLC
The main advantage of trading using opposite Evolent Health and Electrocore LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolent Health position performs unexpectedly, Electrocore LLC 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 Electrocore LLC will offset losses from the drop in Electrocore LLC's long position.| Evolent Health vs. HealthStream | Evolent Health vs. National Research Corp | Evolent Health vs. Forian Inc | Evolent Health vs. HealthEquity |
| Electrocore LLC vs. STRATA Skin Sciences | Electrocore LLC vs. Sight Sciences | Electrocore LLC vs. Neuropace | Electrocore LLC vs. IRIDEX |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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