Correlation Between MyHealthChecked Plc and CVS Health

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

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

Diversification Opportunities for MyHealthChecked Plc and CVS Health

0.55

Correlation Coefficient

MyHealthChecked Plc  CVS Health

Very weak diversification

The 3 months correlation between MyHealthChecked and CVS is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding MyHealthChecked Plc and CVS Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVS Health Corp and MyHealthChecked Plc 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 MyHealthChecked Plc are associated (or correlated) with CVS Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVS Health Corp has no effect on the direction of MyHealthChecked Plc i.e., MyHealthChecked Plc and CVS Health go up and down completely randomly.

Pair Corralation between MyHealthChecked Plc and CVS Health

Assuming the 90 days trading horizon MyHealthChecked Plc is expected to generate 1.29 times more return on investment than CVS Health. However, MyHealthChecked Plc is 1.29 times more volatile than CVS Health Corp. It trades about 0.16 of its potential returns per unit of risk. CVS Health Corp is currently generating about 0.07 per unit of risk. If you would invest  1,200  in MyHealthChecked Plc on December 3, 2024 and sell it today you would earn a total of  550.00  from holding MyHealthChecked Plc or generate 45.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.83%
Values	Daily Returns

MyHealthChecked Plc  vs.  CVS Health Corp

MyHealthChecked Plc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MyHealthChecked Plc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, MyHealthChecked Plc exhibited solid returns over the last few months and may actually be approaching a breakup point.

CVS Health Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CVS Health Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, CVS Health unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with MyHealthChecked Plc and CVS Health

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

The idea behind MyHealthChecked Plc and CVS Health Corp 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 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..