Correlation Between Magellan Financial and Epsilon Healthcare
Can any of the company-specific risk be diversified away by investing in both Magellan Financial and Epsilon Healthcare 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 Magellan Financial and Epsilon Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magellan Financial Group and Epsilon Healthcare, you can compare the effects of market volatilities on Magellan Financial and Epsilon Healthcare 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 Magellan Financial with a short position of Epsilon Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magellan Financial and Epsilon Healthcare.
Diversification Opportunities for Magellan Financial and Epsilon Healthcare
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Magellan and Epsilon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Magellan Financial Group and Epsilon Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Epsilon Healthcare and Magellan Financial 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 Magellan Financial Group are associated (or correlated) with Epsilon Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Epsilon Healthcare has no effect on the direction of Magellan Financial i.e., Magellan Financial and Epsilon Healthcare go up and down completely randomly.
Pair Corralation between Magellan Financial and Epsilon Healthcare
If you would invest 1,077 in Magellan Financial Group on September 20, 2024 and sell it today you would earn a total of 23.00 from holding Magellan Financial Group or generate 2.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Magellan Financial Group vs. Epsilon Healthcare
Performance |
| Timeline |
| Magellan Financial |
| Epsilon Healthcare |
Magellan Financial and Epsilon Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magellan Financial and Epsilon Healthcare
The main advantage of trading using opposite Magellan Financial and Epsilon Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magellan Financial position performs unexpectedly, Epsilon Healthcare 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 Epsilon Healthcare will offset losses from the drop in Epsilon Healthcare's long position.| Magellan Financial vs. Audio Pixels Holdings | Magellan Financial vs. Iodm | Magellan Financial vs. Nsx | Magellan Financial vs. TTG Fintech |
| Epsilon Healthcare vs. Aneka Tambang Tbk | Epsilon Healthcare vs. BHP Group Limited | Epsilon Healthcare vs. Rio Tinto | Epsilon Healthcare vs. Macquarie Group Ltd |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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