Correlation Between NIGHTINGALE HEALTH and Teladoc

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

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

Diversification Opportunities for NIGHTINGALE HEALTH and Teladoc

-0.49

Correlation Coefficient

NIGHTINGALE HEALTH  Teladoc

Very good diversification

The 3 months correlation between NIGHTINGALE and Teladoc is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding NIGHTINGALE HEALTH EO and Teladoc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teladoc and NIGHTINGALE 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 NIGHTINGALE HEALTH EO are associated (or correlated) with Teladoc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teladoc has no effect on the direction of NIGHTINGALE HEALTH i.e., NIGHTINGALE HEALTH and Teladoc go up and down completely randomly.

Pair Corralation between NIGHTINGALE HEALTH and Teladoc

Assuming the 90 days horizon NIGHTINGALE HEALTH EO is expected to under-perform the Teladoc. But the stock apears to be less risky and, when comparing its historical volatility, NIGHTINGALE HEALTH EO is 1.62 times less risky than Teladoc. The stock trades about -0.07 of its potential returns per unit of risk. The Teladoc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  634.00  in Teladoc on April 24, 2025 and sell it today you would earn a total of  84.00  from holding Teladoc or generate 13.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

NIGHTINGALE HEALTH EO  vs.  Teladoc

NIGHTINGALE HEALTH

Risk-Adjusted Performance

Very Weak

Over the last 90 days NIGHTINGALE HEALTH EO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain 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.

Teladoc

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Teladoc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Teladoc reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with NIGHTINGALE HEALTH and Teladoc

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

The idea behind NIGHTINGALE HEALTH EO and Teladoc 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.