Correlation Between GoHealth and Bill
Can any of the company-specific risk be diversified away by investing in both GoHealth and Bill 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 GoHealth and Bill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoHealth and Bill Com Holdings, you can compare the effects of market volatilities on GoHealth and Bill 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 GoHealth with a short position of Bill. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoHealth and Bill.
Diversification Opportunities for GoHealth and Bill
Poor diversification
The 3 months correlation between GoHealth and Bill is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding GoHealth and Bill Com Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bill Com Holdings and GoHealth 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 GoHealth are associated (or correlated) with Bill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bill Com Holdings has no effect on the direction of GoHealth i.e., GoHealth and Bill go up and down completely randomly.
Pair Corralation between GoHealth and Bill
Given the investment horizon of 90 days GoHealth is expected to generate 1.3 times more return on investment than Bill. However, GoHealth is 1.3 times more volatile than Bill Com Holdings. It trades about 0.02 of its potential returns per unit of risk. Bill Com Holdings is currently generating about 0.01 per unit of risk. If you would invest 1,288 in GoHealth on August 31, 2024 and sell it today you would lose (54.00) from holding GoHealth or give up 4.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GoHealth vs. Bill Com Holdings
Performance |
| Timeline |
| GoHealth |
| Bill Com Holdings |
GoHealth and Bill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoHealth and Bill
The main advantage of trading using opposite GoHealth and Bill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoHealth position performs unexpectedly, Bill 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 Bill will offset losses from the drop in Bill's long position.| GoHealth vs. eHealth | GoHealth vs. Tian Ruixiang Holdings | GoHealth vs. Huize Holding | GoHealth vs. Selectquote |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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