Correlation Between Viemed Healthcare and SVELEV

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

By analyzing existing cross correlation between Viemed Healthcare and SVELEV 13 10 FEB 28, you can compare the effects of market volatilities on Viemed Healthcare and SVELEV 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 Viemed Healthcare with a short position of SVELEV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viemed Healthcare and SVELEV.

Diversification Opportunities for Viemed Healthcare and SVELEV

0.07

Correlation Coefficient

Viemed Healthcare  SVELEV

Significant diversification

The 3 months correlation between Viemed and SVELEV is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Viemed Healthcare and SVELEV 13 10 FEB 28 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SVELEV 13 10 and Viemed 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 Viemed Healthcare are associated (or correlated) with SVELEV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SVELEV 13 10 has no effect on the direction of Viemed Healthcare i.e., Viemed Healthcare and SVELEV go up and down completely randomly.

Pair Corralation between Viemed Healthcare and SVELEV

Considering the 90-day investment horizon Viemed Healthcare is expected to generate 9.51 times more return on investment than SVELEV. However, Viemed Healthcare is 9.51 times more volatile than SVELEV 13 10 FEB 28. It trades about 0.11 of its potential returns per unit of risk. SVELEV 13 10 FEB 28 is currently generating about -0.15 per unit of risk. If you would invest  759.00  in Viemed Healthcare on September 5, 2024 and sell it today you would earn a total of  111.00  from holding Viemed Healthcare or generate 14.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	73.44%
Values	Daily Returns

Viemed Healthcare  vs.  SVELEV 13 10 FEB 28

Viemed Healthcare

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Viemed Healthcare are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, Viemed Healthcare exhibited solid returns over the last few months and may actually be approaching a breakup point.

SVELEV 13 10

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SVELEV 13 10 FEB 28 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, SVELEV is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Viemed Healthcare and SVELEV

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

The idea behind Viemed Healthcare and SVELEV 13 10 FEB 28 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.