Correlation Between Edwards Lifesciences and Electrocore LLC
Can any of the company-specific risk be diversified away by investing in both Edwards Lifesciences 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 Edwards Lifesciences and Electrocore LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Edwards Lifesciences Corp and Electrocore LLC, you can compare the effects of market volatilities on Edwards Lifesciences 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 Edwards Lifesciences with a short position of Electrocore LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Edwards Lifesciences and Electrocore LLC.
Diversification Opportunities for Edwards Lifesciences and Electrocore LLC
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Edwards and Electrocore is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Edwards Lifesciences Corp and Electrocore LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electrocore LLC and Edwards Lifesciences 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 Edwards Lifesciences Corp 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 Edwards Lifesciences i.e., Edwards Lifesciences and Electrocore LLC go up and down completely randomly.
Pair Corralation between Edwards Lifesciences and Electrocore LLC
Allowing for the 90-day total investment horizon Edwards Lifesciences is expected to generate 17.27 times less return on investment than Electrocore LLC. But when comparing it to its historical volatility, Edwards Lifesciences Corp is 3.38 times less risky than Electrocore LLC. It trades about 0.04 of its potential returns per unit of risk. Electrocore LLC is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 618.00 in Electrocore LLC on September 2, 2024 and sell it today you would earn a total of 602.00 from holding Electrocore LLC or generate 97.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Edwards Lifesciences Corp vs. Electrocore LLC
Performance |
| Timeline |
| Edwards Lifesciences Corp |
| Electrocore LLC |
Edwards Lifesciences and Electrocore LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Edwards Lifesciences and Electrocore LLC
The main advantage of trading using opposite Edwards Lifesciences and Electrocore LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Edwards Lifesciences 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.| Edwards Lifesciences vs. Medtronic PLC | Edwards Lifesciences vs. Abbott Laboratories | Edwards Lifesciences vs. Boston Scientific Corp | Edwards Lifesciences vs. Zimmer Biomet Holdings |
| 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |