Correlation Between Entero Healthcare and SBI Cards

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

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

Diversification Opportunities for Entero Healthcare and SBI Cards

-0.11

Correlation Coefficient

Entero Healthcare  SBI Cards

Good diversification

The 3 months correlation between Entero and SBI is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Entero Healthcare Solutions and SBI Cards and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Cards and Entero 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 Entero Healthcare Solutions are associated (or correlated) with SBI Cards. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Cards has no effect on the direction of Entero Healthcare i.e., Entero Healthcare and SBI Cards go up and down completely randomly.

Pair Corralation between Entero Healthcare and SBI Cards

Assuming the 90 days trading horizon Entero Healthcare Solutions is expected to under-perform the SBI Cards. But the stock apears to be less risky and, when comparing its historical volatility, Entero Healthcare Solutions is 1.4 times less risky than SBI Cards. The stock trades about -0.18 of its potential returns per unit of risk. The SBI Cards and is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  71,965  in SBI Cards and on October 9, 2024 and sell it today you would earn a total of  1,085  from holding SBI Cards and or generate 1.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Entero Healthcare Solutions  vs.  SBI Cards and

Entero Healthcare

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Entero Healthcare Solutions are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong technical and fundamental indicators, Entero Healthcare is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

SBI Cards

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SBI Cards and has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, SBI Cards is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Entero Healthcare and SBI Cards

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

The idea behind Entero Healthcare Solutions and SBI Cards and 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.