Correlation Between Legato Merger and GoHealth
Can any of the company-specific risk be diversified away by investing in both Legato Merger and GoHealth 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 Legato Merger and GoHealth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legato Merger II and GoHealth, you can compare the effects of market volatilities on Legato Merger and GoHealth 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 Legato Merger with a short position of GoHealth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legato Merger and GoHealth.
Diversification Opportunities for Legato Merger and GoHealth
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Legato and GoHealth is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Legato Merger II and GoHealth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoHealth and Legato Merger 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 Legato Merger II are associated (or correlated) with GoHealth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoHealth has no effect on the direction of Legato Merger i.e., Legato Merger and GoHealth go up and down completely randomly.
Pair Corralation between Legato Merger and GoHealth
Given the investment horizon of 90 days Legato Merger II is expected to generate 5.9 times more return on investment than GoHealth. However, Legato Merger is 5.9 times more volatile than GoHealth. It trades about 0.25 of its potential returns per unit of risk. GoHealth is currently generating about 0.0 per unit of risk. If you would invest 280.00 in Legato Merger II on September 12, 2024 and sell it today you would earn a total of 464.00 from holding Legato Merger II or generate 165.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Legato Merger II vs. GoHealth
Performance |
| Timeline |
| Legato Merger II |
| GoHealth |
Legato Merger and GoHealth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legato Merger and GoHealth
The main advantage of trading using opposite Legato Merger and GoHealth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legato Merger position performs unexpectedly, GoHealth 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 GoHealth will offset losses from the drop in GoHealth's long position.| Legato Merger vs. Ecoloclean Industrs | Legato Merger vs. Lifevantage | Legato Merger vs. Jeld Wen Holding | Legato Merger vs. CECO Environmental Corp |
| 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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