Correlation Between Femasys and Everest

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

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

Diversification Opportunities for Femasys and Everest

-0.42

Correlation Coefficient

Femasys  Everest

Very good diversification

The 3 months correlation between Femasys and Everest is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Femasys and Everest Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everest Group and Femasys 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 Femasys are associated (or correlated) with Everest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everest Group has no effect on the direction of Femasys i.e., Femasys and Everest go up and down completely randomly.

Pair Corralation between Femasys and Everest

Given the investment horizon of 90 days Femasys is expected to generate 3.27 times more return on investment than Everest. However, Femasys is 3.27 times more volatile than Everest Group. It trades about 0.15 of its potential returns per unit of risk. Everest Group is currently generating about 0.05 per unit of risk. If you would invest  110.00  in Femasys on December 19, 2024 and sell it today you would earn a total of  44.00  from holding Femasys or generate 40.0% return on investment over 90 days.

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

Femasys  vs.  Everest Group

Femasys

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Femasys are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak primary indicators, Femasys showed solid returns over the last few months and may actually be approaching a breakup point.

Everest Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Everest Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Everest is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Femasys and Everest

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

The idea behind Femasys and Everest Group 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.