Correlation Between EHEALTH and Trisura

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

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

Diversification Opportunities for EHEALTH and Trisura

-0.54

Correlation Coefficient

EHEALTH  Trisura

Excellent diversification

The 3 months correlation between EHEALTH and Trisura is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding EHEALTH and Trisura Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisura Group and EHEALTH 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 EHEALTH are associated (or correlated) with Trisura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisura Group has no effect on the direction of EHEALTH i.e., EHEALTH and Trisura go up and down completely randomly.

Pair Corralation between EHEALTH and Trisura

Assuming the 90 days trading horizon EHEALTH is expected to generate 3.66 times more return on investment than Trisura. However, EHEALTH is 3.66 times more volatile than Trisura Group. It trades about 0.22 of its potential returns per unit of risk. Trisura Group is currently generating about -0.08 per unit of risk. If you would invest  351.00  in EHEALTH on September 22, 2024 and sell it today you would earn a total of  428.00  from holding EHEALTH or generate 121.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.48%
Values	Daily Returns

EHEALTH  vs.  Trisura Group

EHEALTH

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in EHEALTH are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, EHEALTH exhibited solid returns over the last few months and may actually be approaching a breakup point.

Trisura Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Trisura Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with EHEALTH and Trisura

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

The idea behind EHEALTH and Trisura Group 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.