Correlation Between EHEALTH and GRUPO ECOENER
Can any of the company-specific risk be diversified away by investing in both EHEALTH and GRUPO ECOENER 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 EHEALTH and GRUPO ECOENER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EHEALTH and GRUPO ECOENER EO, you can compare the effects of market volatilities on EHEALTH and GRUPO ECOENER 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 EHEALTH with a short position of GRUPO ECOENER. Check out your portfolio center. Please also check ongoing floating volatility patterns of EHEALTH and GRUPO ECOENER.
Diversification Opportunities for EHEALTH and GRUPO ECOENER
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EHEALTH and GRUPO is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding EHEALTH and GRUPO ECOENER EO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRUPO ECOENER EO and EHEALTH 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 EHEALTH are associated (or correlated) with GRUPO ECOENER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRUPO ECOENER EO has no effect on the direction of EHEALTH i.e., EHEALTH and GRUPO ECOENER go up and down completely randomly.
Pair Corralation between EHEALTH and GRUPO ECOENER
Assuming the 90 days trading horizon EHEALTH is expected to generate 7.16 times more return on investment than GRUPO ECOENER. However, EHEALTH is 7.16 times more volatile than GRUPO ECOENER EO. It trades about 0.38 of its potential returns per unit of risk. GRUPO ECOENER EO is currently generating about 0.52 per unit of risk. If you would invest 513.00 in EHEALTH on October 12, 2024 and sell it today you would earn a total of 426.00 from holding EHEALTH or generate 83.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
EHEALTH vs. GRUPO ECOENER EO
Performance |
| Timeline |
| EHEALTH |
| GRUPO ECOENER EO |
EHEALTH and GRUPO ECOENER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EHEALTH and GRUPO ECOENER
The main advantage of trading using opposite EHEALTH and GRUPO ECOENER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EHEALTH position performs unexpectedly, GRUPO ECOENER 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 GRUPO ECOENER will offset losses from the drop in GRUPO ECOENER's long position.| EHEALTH vs. Westinghouse Air Brake | EHEALTH vs. Altair Engineering | EHEALTH vs. Ultra Clean Holdings | EHEALTH vs. Rayonier Advanced Materials |
| GRUPO ECOENER vs. HANOVER INSURANCE | GRUPO ECOENER vs. MidCap Financial Investment | GRUPO ECOENER vs. ECHO INVESTMENT ZY | GRUPO ECOENER vs. Vienna Insurance Group |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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