Correlation Between Evolent Health and Semler Scientific
Can any of the company-specific risk be diversified away by investing in both Evolent Health and Semler Scientific 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 Semler Scientific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolent Health and Semler Scientific, you can compare the effects of market volatilities on Evolent Health and Semler Scientific 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 Semler Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolent Health and Semler Scientific.
Diversification Opportunities for Evolent Health and Semler Scientific
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Evolent and Semler is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Evolent Health and Semler Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semler Scientific 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 Semler Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semler Scientific has no effect on the direction of Evolent Health i.e., Evolent Health and Semler Scientific go up and down completely randomly.
Pair Corralation between Evolent Health and Semler Scientific
Considering the 90-day investment horizon Evolent Health is expected to under-perform the Semler Scientific. But the stock apears to be less risky and, when comparing its historical volatility, Evolent Health is 1.07 times less risky than Semler Scientific. The stock trades about -0.21 of its potential returns per unit of risk. The Semler Scientific is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 2,647 in Semler Scientific on August 24, 2024 and sell it today you would earn a total of 3,718 from holding Semler Scientific or generate 140.46% 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. Semler Scientific
Performance |
| Timeline |
| Evolent Health |
| Semler Scientific |
Evolent Health and Semler Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolent Health and Semler Scientific
The main advantage of trading using opposite Evolent Health and Semler Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolent Health position performs unexpectedly, Semler Scientific 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 Semler Scientific will offset losses from the drop in Semler Scientific's long position.| Evolent Health vs. HealthStream | Evolent Health vs. National Research Corp | Evolent Health vs. HealthEquity | Evolent Health vs. Health Catalyst |
| Semler Scientific vs. CVRx Inc | Semler Scientific vs. SurModics | Semler Scientific vs. Pulmonx Corp | Semler Scientific vs. Orthofix Medical |
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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