Correlation Between Malvern International and MyHealthChecked Plc

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

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

Diversification Opportunities for Malvern International and MyHealthChecked Plc

-0.43

Correlation Coefficient

Malvern International  MyHealthChecked Plc

Very good diversification

The 3 months correlation between Malvern and MyHealthChecked is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Malvern International and MyHealthChecked Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MyHealthChecked Plc and Malvern International 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 Malvern International 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 Malvern International i.e., Malvern International and MyHealthChecked Plc go up and down completely randomly.

Pair Corralation between Malvern International and MyHealthChecked Plc

Assuming the 90 days trading horizon Malvern International is expected to under-perform the MyHealthChecked Plc. But the stock apears to be less risky and, when comparing its historical volatility, Malvern International is 1.9 times less risky than MyHealthChecked Plc. The stock trades about -0.01 of its potential returns per unit of risk. The MyHealthChecked Plc is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  1,000.00  in MyHealthChecked Plc on October 22, 2024 and sell it today you would earn a total of  525.00  from holding MyHealthChecked Plc or generate 52.5% return on investment over 90 days.

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

Malvern International  vs.  MyHealthChecked Plc

Malvern International

Risk-Adjusted Performance

5 of 100

Modest

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

MyHealthChecked Plc

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in MyHealthChecked Plc are ranked lower than 4 (%) 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.

Pair Trading with Malvern International and MyHealthChecked Plc

The main advantage of trading using opposite Malvern International and MyHealthChecked Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malvern International 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 Malvern International 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.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.