Correlation Between Evolent Health and Progyny
Can any of the company-specific risk be diversified away by investing in both Evolent Health and Progyny 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 Progyny into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolent Health and Progyny, you can compare the effects of market volatilities on Evolent Health and Progyny 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 Progyny. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolent Health and Progyny.
Diversification Opportunities for Evolent Health and Progyny
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Evolent and Progyny is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Evolent Health and Progyny in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progyny 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 Progyny. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progyny has no effect on the direction of Evolent Health i.e., Evolent Health and Progyny go up and down completely randomly.
Pair Corralation between Evolent Health and Progyny
Considering the 90-day investment horizon Evolent Health is expected to under-perform the Progyny. In addition to that, Evolent Health is 2.18 times more volatile than Progyny. It trades about -0.15 of its total potential returns per unit of risk. Progyny is currently generating about 0.01 per unit of volatility. If you would invest 1,582 in Progyny on September 3, 2024 and sell it today you would lose (25.00) from holding Progyny or give up 1.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolent Health vs. Progyny
Performance |
| Timeline |
| Evolent Health |
| Progyny |
Evolent Health and Progyny Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolent Health and Progyny
The main advantage of trading using opposite Evolent Health and Progyny positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolent Health position performs unexpectedly, Progyny 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 Progyny will offset losses from the drop in Progyny's long position.| Evolent Health vs. Progyny | Evolent Health vs. Teladoc | Evolent Health vs. Goodrx Holdings | Evolent Health vs. 10X Genomics |
| Progyny vs. Veeva Systems Class | Progyny vs. Teladoc | Progyny vs. Goodrx Holdings | Progyny vs. 10X Genomics |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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