Correlation Between Healthcare and Digital Health
Can any of the company-specific risk be diversified away by investing in both Healthcare and Digital Health 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 Healthcare and Digital Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Healthcare AI Acquisition and Digital Health Acquisition, you can compare the effects of market volatilities on Healthcare and Digital Health 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 Healthcare with a short position of Digital Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Healthcare and Digital Health.
Diversification Opportunities for Healthcare and Digital Health
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Healthcare and Digital is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Healthcare AI Acquisition and Digital Health Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital Health Acqui and Healthcare 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 Healthcare AI Acquisition are associated (or correlated) with Digital Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital Health Acqui has no effect on the direction of Healthcare i.e., Healthcare and Digital Health go up and down completely randomly.
Pair Corralation between Healthcare and Digital Health
If you would invest 1,211 in Digital Health Acquisition on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Digital Health Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Healthcare AI Acquisition vs. Digital Health Acquisition
Performance |
| Timeline |
| Healthcare AI Acquisition |
| Digital Health Acqui |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Healthcare and Digital Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Healthcare and Digital Health
The main advantage of trading using opposite Healthcare and Digital Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Healthcare position performs unexpectedly, Digital Health 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 Digital Health will offset losses from the drop in Digital Health's long position.| Healthcare vs. Patria Latin American | Healthcare vs. ABIVAX Socit Anonyme | Healthcare vs. Pinnacle Sherman Multi Strategy | Healthcare vs. Morningstar Unconstrained Allocation |
| Digital Health vs. Insight Acquisition Corp | Digital Health vs. AlphaVest Acquisition Corp | Digital Health vs. Oak Woods Acquisition | Digital Health vs. Insight Acquisition Corp |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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