Correlation Between First and MyHealthChecked Plc

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

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

Diversification Opportunities for First and MyHealthChecked Plc

-0.32

Correlation Coefficient

First  MyHealthChecked Plc

Very good diversification

The 3 months correlation between First and MyHealthChecked is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding First Class Metals and MyHealthChecked Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MyHealthChecked Plc and First 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 First Class Metals are associated (or correlated) with MyHealthChecked Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MyHealthChecked Plc has no effect on the direction of First i.e., First and MyHealthChecked Plc go up and down completely randomly.

Pair Corralation between First and MyHealthChecked Plc

Assuming the 90 days trading horizon First Class Metals is expected to under-perform the MyHealthChecked Plc. In addition to that, First is 1.24 times more volatile than MyHealthChecked Plc. It trades about -0.33 of its total potential returns per unit of risk. MyHealthChecked Plc is currently generating about 0.21 per unit of volatility. If you would invest  1,100  in MyHealthChecked Plc on October 8, 2024 and sell it today you would earn a total of  125.00  from holding MyHealthChecked Plc or generate 11.36% return on investment over 90 days.

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

First Class Metals  vs.  MyHealthChecked Plc

First Class Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days First Class Metals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

MyHealthChecked Plc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with First and MyHealthChecked Plc

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

The idea behind First Class Metals and MyHealthChecked Plc 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.