Correlation Between So Young and Phreesia
Can any of the company-specific risk be diversified away by investing in both So Young and Phreesia 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 So Young and Phreesia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between So Young International and Phreesia, you can compare the effects of market volatilities on So Young and Phreesia 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 So Young with a short position of Phreesia. Check out your portfolio center. Please also check ongoing floating volatility patterns of So Young and Phreesia.
Diversification Opportunities for So Young and Phreesia
Very good diversification
The 3 months correlation between So Young and Phreesia is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding So Young International and Phreesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phreesia and So Young 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 So Young International are associated (or correlated) with Phreesia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phreesia has no effect on the direction of So Young i.e., So Young and Phreesia go up and down completely randomly.
Pair Corralation between So Young and Phreesia
Allowing for the 90-day total investment horizon So Young International is expected to under-perform the Phreesia. In addition to that, So Young is 1.32 times more volatile than Phreesia. It trades about -0.02 of its total potential returns per unit of risk. Phreesia is currently generating about 0.16 per unit of volatility. If you would invest 1,829 in Phreesia on September 1, 2024 and sell it today you would earn a total of 274.00 from holding Phreesia or generate 14.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
So Young International vs. Phreesia
Performance |
| Timeline |
| So Young International |
| Phreesia |
So Young and Phreesia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with So Young and Phreesia
The main advantage of trading using opposite So Young and Phreesia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if So Young position performs unexpectedly, Phreesia 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 Phreesia will offset losses from the drop in Phreesia's long position.| So Young vs. National Research Corp | So Young vs. Definitive Healthcare Corp | So Young vs. HealthStream | So Young vs. Streamline Health Solutions |
| Phreesia vs. Definitive Healthcare Corp | Phreesia vs. HealthStream | Phreesia vs. Certara | Phreesia vs. National Research Corp |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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