Correlation Between Eventide Healthcare and Energy Fund
Can any of the company-specific risk be diversified away by investing in both Eventide Healthcare and Energy Fund 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 Eventide Healthcare and Energy Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eventide Healthcare Life and Energy Fund Class, you can compare the effects of market volatilities on Eventide Healthcare and Energy Fund 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 Eventide Healthcare with a short position of Energy Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eventide Healthcare and Energy Fund.
Diversification Opportunities for Eventide Healthcare and Energy Fund
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eventide and ENERGY is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Eventide Healthcare Life and Energy Fund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Fund Class and Eventide 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 Eventide Healthcare Life are associated (or correlated) with Energy Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Fund Class has no effect on the direction of Eventide Healthcare i.e., Eventide Healthcare and Energy Fund go up and down completely randomly.
Pair Corralation between Eventide Healthcare and Energy Fund
Assuming the 90 days horizon Eventide Healthcare Life is expected to under-perform the Energy Fund. In addition to that, Eventide Healthcare is 1.21 times more volatile than Energy Fund Class. It trades about -0.08 of its total potential returns per unit of risk. Energy Fund Class is currently generating about -0.09 per unit of volatility. If you would invest 20,061 in Energy Fund Class on December 3, 2024 and sell it today you would lose (1,409) from holding Energy Fund Class or give up 7.02% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.36% |
Values | Daily Returns |
Eventide Healthcare Life vs. Energy Fund Class
Performance |
Timeline |
Eventide Healthcare Life |
Energy Fund Class |
Eventide Healthcare and Energy Fund Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eventide Healthcare and Energy Fund
The main advantage of trading using opposite Eventide Healthcare and Energy Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eventide Healthcare position performs unexpectedly, Energy Fund 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 Energy Fund will offset losses from the drop in Energy Fund's long position.Eventide Healthcare vs. Invesco Global Health | Eventide Healthcare vs. Delaware Healthcare Fund | Eventide Healthcare vs. John Hancock Variable | Eventide Healthcare vs. Schwab Health Care |
Energy Fund vs. Energy Services Fund | Energy Fund vs. Basic Materials Fund | Energy Fund vs. Health Care Fund | Energy Fund vs. Precious Metals Fund |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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