Correlation Between Epitomee Medical and Evogene

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

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

Diversification Opportunities for Epitomee Medical and Evogene

0.01

Correlation Coefficient

Epitomee Medical  Evogene

Significant diversification

The 3 months correlation between Epitomee and Evogene is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Epitomee Medical and Evogene in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evogene and Epitomee Medical 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 Epitomee Medical are associated (or correlated) with Evogene. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evogene has no effect on the direction of Epitomee Medical i.e., Epitomee Medical and Evogene go up and down completely randomly.

Pair Corralation between Epitomee Medical and Evogene

Assuming the 90 days trading horizon Epitomee Medical is expected to generate 2.26 times less return on investment than Evogene. But when comparing it to its historical volatility, Epitomee Medical is 3.07 times less risky than Evogene. It trades about 0.08 of its potential returns per unit of risk. Evogene is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  38,900  in Evogene on April 24, 2025 and sell it today you would earn a total of  4,300  from holding Evogene or generate 11.05% return on investment over 90 days.

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

Epitomee Medical  vs.  Evogene

Epitomee Medical

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Epitomee Medical are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Epitomee Medical sustained solid returns over the last few months and may actually be approaching a breakup point.

Evogene

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Evogene are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Evogene sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Epitomee Medical and Evogene

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

The idea behind Epitomee Medical and Evogene 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.