Correlation Between Entourage Health and Ravenquest Biomed

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

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

Diversification Opportunities for Entourage Health and Ravenquest Biomed

0.0

Correlation Coefficient

Entourage Health  Ravenquest Biomed

Pay attention - limited upside

The 3 months correlation between Entourage and Ravenquest is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Entourage Health Corp and Ravenquest Biomed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ravenquest Biomed and Entourage Health 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 Entourage Health Corp are associated (or correlated) with Ravenquest Biomed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ravenquest Biomed has no effect on the direction of Entourage Health i.e., Entourage Health and Ravenquest Biomed go up and down completely randomly.

Pair Corralation between Entourage Health and Ravenquest Biomed

Assuming the 90 days horizon Entourage Health Corp is expected to generate 3.31 times more return on investment than Ravenquest Biomed. However, Entourage Health is 3.31 times more volatile than Ravenquest Biomed. It trades about 0.06 of its potential returns per unit of risk. Ravenquest Biomed is currently generating about -0.04 per unit of risk. If you would invest  1.47  in Entourage Health Corp on September 18, 2024 and sell it today you would lose (0.60) from holding Entourage Health Corp or give up 40.82% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Entourage Health Corp  vs.  Ravenquest Biomed

Entourage Health Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Entourage Health Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Entourage Health reported solid returns over the last few months and may actually be approaching a breakup point.

Ravenquest Biomed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ravenquest Biomed has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Ravenquest Biomed is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Entourage Health and Ravenquest Biomed

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

The idea behind Entourage Health Corp and Ravenquest Biomed 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 CEOs Directory module to screen CEOs from public companies around the world.