Correlation Between Accolade and Talkspace

Can any of the company-specific risk be diversified away by investing in both Accolade and Talkspace 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 Accolade and Talkspace into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Accolade and Talkspace, you can compare the effects of market volatilities on Accolade and Talkspace 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 Accolade with a short position of Talkspace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accolade and Talkspace.

Diversification Opportunities for Accolade and Talkspace

-0.73

Correlation Coefficient

Accolade  Talkspace

Pay attention - limited upside

The 3 months correlation between Accolade and Talkspace is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Accolade and Talkspace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talkspace and Accolade 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 Accolade are associated (or correlated) with Talkspace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talkspace has no effect on the direction of Accolade i.e., Accolade and Talkspace go up and down completely randomly.

Pair Corralation between Accolade and Talkspace

Given the investment horizon of 90 days Accolade is expected to under-perform the Talkspace. But the stock apears to be less risky and, when comparing its historical volatility, Accolade is 1.54 times less risky than Talkspace. The stock trades about -0.06 of its potential returns per unit of risk. The Talkspace is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  200.00  in Talkspace on August 30, 2024 and sell it today you would earn a total of  147.00  from holding Talkspace or generate 73.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Accolade  vs.  Talkspace

Accolade

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Accolade has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Talkspace

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Talkspace are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite quite weak essential indicators, Talkspace disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Accolade and Talkspace

The main advantage of trading using opposite Accolade and Talkspace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accolade position performs unexpectedly, Talkspace 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 Talkspace will offset losses from the drop in Talkspace's long position.

The idea behind Accolade and Talkspace pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.