Correlation Between Tekla Healthcare and Ancorathelen Small

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

By analyzing existing cross correlation between Tekla Healthcare Opportunities and Ancorathelen Small Mid Cap, you can compare the effects of market volatilities on Tekla Healthcare and Ancorathelen Small 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 Tekla Healthcare with a short position of Ancorathelen Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tekla Healthcare and Ancorathelen Small.

Diversification Opportunities for Tekla Healthcare and Ancorathelen Small

-0.58

Correlation Coefficient

Tekla Healthcare  Ancorathelen Small

Excellent diversification

The 3 months correlation between Tekla and Ancorathelen is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Tekla Healthcare Opportunities and Ancorathelen Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ancorathelen Small Mid and Tekla Healthcare 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 Tekla Healthcare Opportunities are associated (or correlated) with Ancorathelen Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ancorathelen Small Mid has no effect on the direction of Tekla Healthcare i.e., Tekla Healthcare and Ancorathelen Small go up and down completely randomly.

Pair Corralation between Tekla Healthcare and Ancorathelen Small

Considering the 90-day investment horizon Tekla Healthcare Opportunities is expected to under-perform the Ancorathelen Small. In addition to that, Tekla Healthcare is 1.11 times more volatile than Ancorathelen Small Mid Cap. It trades about -0.11 of its total potential returns per unit of risk. Ancorathelen Small Mid Cap is currently generating about 0.17 per unit of volatility. If you would invest  2,009  in Ancorathelen Small Mid Cap on September 13, 2024 and sell it today you would earn a total of  223.00  from holding Ancorathelen Small Mid Cap or generate 11.1% return on investment over 90 days.

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

Tekla Healthcare Opportunities  vs.  Ancorathelen Small Mid Cap

Tekla Healthcare Opp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Tekla Healthcare Opportunities has generated negative risk-adjusted returns adding no value to fund investors. Even with latest inconsistent performance, the Fund's technical indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the fund retail investors.

Ancorathelen Small Mid

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ancorathelen Small Mid Cap are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Ancorathelen Small may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Tekla Healthcare and Ancorathelen Small

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

The idea behind Tekla Healthcare Opportunities and Ancorathelen Small Mid Cap 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.