Correlation Between Tekla Healthcare and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Tekla Healthcare and Eaton Vance 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 Tekla Healthcare and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tekla Healthcare Opportunities and Eaton Vance Worldwide, you can compare the effects of market volatilities on Tekla Healthcare and Eaton Vance 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 Tekla Healthcare with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Eaton Vance.
Diversification Opportunities for Tekla Healthcare and Eaton Vance
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tekla and Eaton is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Opportunities and Eaton Vance Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Worldwide and Tekla Healthcare 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 Tekla Healthcare Opportunities are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Worldwide has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Eaton Vance go up and down completely randomly.
Pair Corralation between Tekla Healthcare and Eaton Vance
Considering the 90-day investment horizon Tekla Healthcare Opportunities is expected to generate 1.38 times more return on investment than Eaton Vance. However, Tekla Healthcare is 1.38 times more volatile than Eaton Vance Worldwide. It trades about 0.03 of its potential returns per unit of risk. Eaton Vance Worldwide is currently generating about 0.01 per unit of risk. If you would invest 1,905 in Tekla Healthcare Opportunities on August 24, 2024 and sell it today you would earn a total of 67.00 from holding Tekla Healthcare Opportunities or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tekla Healthcare Opportunities vs. Eaton Vance Worldwide
Performance |
| Timeline |
| Tekla Healthcare Opp |
| Eaton Vance Worldwide |
Tekla Healthcare and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tekla Healthcare and Eaton Vance
The main advantage of trading using opposite Tekla Healthcare and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tekla Healthcare position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Tekla Healthcare vs. Tekla Healthcare Investors | Tekla Healthcare vs. Tekla Life Sciences | Tekla Healthcare vs. Cohen Steers Reit | Tekla Healthcare vs. XAI Octagon Floating |
| Eaton Vance vs. Lord Abbett Health | Eaton Vance vs. Eventide Healthcare Life | Eaton Vance vs. Tekla Healthcare Opportunities | Eaton Vance vs. Prudential Health Sciences |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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