Correlation Between Hansen Technologies and EMvision Medical

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

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

Diversification Opportunities for Hansen Technologies and EMvision Medical

0.04

Correlation Coefficient

Hansen Technologies  EMvision Medical

Significant diversification

The 3 months correlation between Hansen and EMvision is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Hansen Technologies and EMvision Medical Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMvision Medical Devices and Hansen Technologies 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 Hansen Technologies are associated (or correlated) with EMvision Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMvision Medical Devices has no effect on the direction of Hansen Technologies i.e., Hansen Technologies and EMvision Medical go up and down completely randomly.

Pair Corralation between Hansen Technologies and EMvision Medical

Assuming the 90 days trading horizon Hansen Technologies is expected to under-perform the EMvision Medical. But the stock apears to be less risky and, when comparing its historical volatility, Hansen Technologies is 1.92 times less risky than EMvision Medical. The stock trades about -0.09 of its potential returns per unit of risk. The EMvision Medical Devices is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  185.00  in EMvision Medical Devices on December 30, 2024 and sell it today you would earn a total of  19.00  from holding EMvision Medical Devices or generate 10.27% return on investment over 90 days.

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

Hansen Technologies  vs.  EMvision Medical Devices

Hansen Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hansen Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

EMvision Medical Devices

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in EMvision Medical Devices are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, EMvision Medical may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Hansen Technologies and EMvision Medical

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

The idea behind Hansen Technologies and EMvision Medical Devices 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.