Correlation Between Infinitt Healthcare and EBEST Investment

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

By analyzing existing cross correlation between Infinitt Healthcare Co and EBEST Investment Securities, you can compare the effects of market volatilities on Infinitt Healthcare and EBEST Investment 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 Infinitt Healthcare with a short position of EBEST Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinitt Healthcare and EBEST Investment.

Diversification Opportunities for Infinitt Healthcare and EBEST Investment

0.85

Correlation Coefficient

Infinitt Healthcare  EBEST Investment

Very poor diversification

The 3 months correlation between Infinitt and EBEST is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Infinitt Healthcare Co and EBEST Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EBEST Investment Sec and Infinitt 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 Infinitt Healthcare Co are associated (or correlated) with EBEST Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EBEST Investment Sec has no effect on the direction of Infinitt Healthcare i.e., Infinitt Healthcare and EBEST Investment go up and down completely randomly.

Pair Corralation between Infinitt Healthcare and EBEST Investment

Assuming the 90 days trading horizon Infinitt Healthcare is expected to generate 2.27 times less return on investment than EBEST Investment. But when comparing it to its historical volatility, Infinitt Healthcare Co is 1.28 times less risky than EBEST Investment. It trades about 0.11 of its potential returns per unit of risk. EBEST Investment Securities is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  383,500  in EBEST Investment Securities on April 24, 2025 and sell it today you would earn a total of  169,500  from holding EBEST Investment Securities or generate 44.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Infinitt Healthcare Co  vs.  EBEST Investment Securities

Infinitt Healthcare

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Infinitt Healthcare Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Infinitt Healthcare sustained solid returns over the last few months and may actually be approaching a breakup point.

EBEST Investment Sec

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in EBEST Investment Securities are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, EBEST Investment sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Infinitt Healthcare and EBEST Investment

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

The idea behind Infinitt Healthcare Co and EBEST Investment Securities 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.