Correlation Between HUDSON TECHNOLOGY and EHEALTH
Can any of the company-specific risk be diversified away by investing in both HUDSON TECHNOLOGY and EHEALTH 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 HUDSON TECHNOLOGY and EHEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HUDSON TECHNOLOGY and EHEALTH, you can compare the effects of market volatilities on HUDSON TECHNOLOGY and EHEALTH 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 HUDSON TECHNOLOGY with a short position of EHEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of HUDSON TECHNOLOGY and EHEALTH.
Diversification Opportunities for HUDSON TECHNOLOGY and EHEALTH
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HUDSON and EHEALTH is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding HUDSON TECHNOLOGY and EHEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EHEALTH and HUDSON TECHNOLOGY 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 HUDSON TECHNOLOGY are associated (or correlated) with EHEALTH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EHEALTH has no effect on the direction of HUDSON TECHNOLOGY i.e., HUDSON TECHNOLOGY and EHEALTH go up and down completely randomly.
Pair Corralation between HUDSON TECHNOLOGY and EHEALTH
Assuming the 90 days trading horizon HUDSON TECHNOLOGY is expected to under-perform the EHEALTH. But the stock apears to be less risky and, when comparing its historical volatility, HUDSON TECHNOLOGY is 1.24 times less risky than EHEALTH. The stock trades about -0.02 of its potential returns per unit of risk. The EHEALTH is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 396.00 in EHEALTH on September 3, 2024 and sell it today you would earn a total of 99.00 from holding EHEALTH or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HUDSON TECHNOLOGY vs. EHEALTH
Performance |
| Timeline |
| HUDSON TECHNOLOGY |
| EHEALTH |
HUDSON TECHNOLOGY and EHEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HUDSON TECHNOLOGY and EHEALTH
The main advantage of trading using opposite HUDSON TECHNOLOGY and EHEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HUDSON TECHNOLOGY position performs unexpectedly, EHEALTH 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 EHEALTH will offset losses from the drop in EHEALTH's long position.| HUDSON TECHNOLOGY vs. EHEALTH | HUDSON TECHNOLOGY vs. Harmony Gold Mining | HUDSON TECHNOLOGY vs. Lion One Metals | HUDSON TECHNOLOGY vs. ADRIATIC METALS LS 013355 |
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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