Correlation Between Joint Corp and Electromed
Can any of the company-specific risk be diversified away by investing in both Joint Corp and Electromed 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 Joint Corp and Electromed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Joint Corp and Electromed, you can compare the effects of market volatilities on Joint Corp and Electromed 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 Joint Corp with a short position of Electromed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Joint Corp and Electromed.
Diversification Opportunities for Joint Corp and Electromed
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Joint and Electromed is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding The Joint Corp and Electromed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electromed and Joint Corp 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 The Joint Corp are associated (or correlated) with Electromed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electromed has no effect on the direction of Joint Corp i.e., Joint Corp and Electromed go up and down completely randomly.
Pair Corralation between Joint Corp and Electromed
Given the investment horizon of 90 days Joint Corp is expected to generate 4.18 times less return on investment than Electromed. In addition to that, Joint Corp is 1.06 times more volatile than Electromed. It trades about 0.11 of its total potential returns per unit of risk. Electromed is currently generating about 0.5 per unit of volatility. If you would invest 2,238 in Electromed on August 28, 2024 and sell it today you would earn a total of 788.00 from holding Electromed or generate 35.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Joint Corp vs. Electromed
Performance |
| Timeline |
| Joint Corp |
| Electromed |
Joint Corp and Electromed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Joint Corp and Electromed
The main advantage of trading using opposite Joint Corp and Electromed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Joint Corp position performs unexpectedly, Electromed 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 Electromed will offset losses from the drop in Electromed's long position.| Joint Corp vs. Encompass Health Corp | Joint Corp vs. Pennant Group | Joint Corp vs. Enhabit | Joint Corp vs. ModivCare |
| Electromed vs. Neuropace | Electromed vs. Orthopediatrics Corp | Electromed vs. SurModics | Electromed vs. Paragon 28 |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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