Correlation Between Tekla Healthcare and Strategic Advisers
Can any of the company-specific risk be diversified away by investing in both Tekla Healthcare and Strategic Advisers 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 Strategic Advisers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tekla Healthcare Investors and Strategic Advisers Fidelity, you can compare the effects of market volatilities on Tekla Healthcare and Strategic Advisers 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 Strategic Advisers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Strategic Advisers.
Diversification Opportunities for Tekla Healthcare and Strategic Advisers
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tekla and Strategic is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Investors and Strategic Advisers Fidelity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Advisers 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 Investors are associated (or correlated) with Strategic Advisers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Advisers has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Strategic Advisers go up and down completely randomly.
Pair Corralation between Tekla Healthcare and Strategic Advisers
Assuming the 90 days horizon Tekla Healthcare Investors is expected to generate 3.3 times more return on investment than Strategic Advisers. However, Tekla Healthcare is 3.3 times more volatile than Strategic Advisers Fidelity. It trades about 0.22 of its potential returns per unit of risk. Strategic Advisers Fidelity is currently generating about 0.05 per unit of risk. If you would invest 1,853 in Tekla Healthcare Investors on November 3, 2024 and sell it today you would earn a total of 85.00 from holding Tekla Healthcare Investors or generate 4.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tekla Healthcare Investors vs. Strategic Advisers Fidelity
Performance |
| Timeline |
| Tekla Healthcare Inv |
| Strategic Advisers |
Tekla Healthcare and Strategic Advisers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tekla Healthcare and Strategic Advisers
The main advantage of trading using opposite Tekla Healthcare and Strategic Advisers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tekla Healthcare position performs unexpectedly, Strategic Advisers 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 Strategic Advisers will offset losses from the drop in Strategic Advisers' long position.| Tekla Healthcare vs. Blackrock Health Sciences | Tekla Healthcare vs. Fidelity Advisor Health | Tekla Healthcare vs. Highland Longshort Healthcare | Tekla Healthcare vs. Alphacentric Lifesci Healthcare |
| Strategic Advisers vs. Deutsche Gold Precious | Strategic Advisers vs. Gabelli Gold Fund | Strategic Advisers vs. James Balanced Golden | Strategic Advisers vs. Invesco Gold Special |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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