Correlation Between MeVis Medical and EHEALTH
Can any of the company-specific risk be diversified away by investing in both MeVis Medical 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 MeVis Medical and EHEALTH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MeVis Medical Solutions and EHEALTH, you can compare the effects of market volatilities on MeVis Medical 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 MeVis Medical with a short position of EHEALTH. Check out your portfolio center. Please also check ongoing floating volatility patterns of MeVis Medical and EHEALTH.
Diversification Opportunities for MeVis Medical and EHEALTH
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MeVis and EHEALTH is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding MeVis Medical Solutions and EHEALTH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EHEALTH and MeVis Medical 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 MeVis Medical Solutions 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 MeVis Medical i.e., MeVis Medical and EHEALTH go up and down completely randomly.
Pair Corralation between MeVis Medical and EHEALTH
Assuming the 90 days trading horizon MeVis Medical is expected to generate 299.06 times less return on investment than EHEALTH. But when comparing it to its historical volatility, MeVis Medical Solutions is 7.22 times less risky than EHEALTH. It trades about 0.01 of its potential returns per unit of risk. EHEALTH is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 449.00 in EHEALTH on September 25, 2024 and sell it today you would earn a total of 339.00 from holding EHEALTH or generate 75.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MeVis Medical Solutions vs. EHEALTH
Performance |
| Timeline |
| MeVis Medical Solutions |
| EHEALTH |
MeVis Medical and EHEALTH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MeVis Medical and EHEALTH
The main advantage of trading using opposite MeVis Medical and EHEALTH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MeVis Medical 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.| MeVis Medical vs. Apple Inc | MeVis Medical vs. Apple Inc | MeVis Medical vs. Apple Inc | MeVis Medical vs. Apple Inc |
| EHEALTH vs. MeVis Medical Solutions | EHEALTH vs. ATOSS SOFTWARE | EHEALTH vs. CPU SOFTWAREHOUSE | EHEALTH vs. ASURE SOFTWARE |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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