Correlation Between FEMALE HEALTH and NATIONAL HEALTHCARE

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

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

Diversification Opportunities for FEMALE HEALTH and NATIONAL HEALTHCARE

0.33

Correlation Coefficient

FEMALE HEALTH  NATIONAL HEALTHCARE

Weak diversification

The 3 months correlation between FEMALE and NATIONAL is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding FEMALE HEALTH and NATIONAL HEALTHCARE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NATIONAL HEALTHCARE and FEMALE 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 FEMALE HEALTH are associated (or correlated) with NATIONAL HEALTHCARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NATIONAL HEALTHCARE has no effect on the direction of FEMALE HEALTH i.e., FEMALE HEALTH and NATIONAL HEALTHCARE go up and down completely randomly.

Pair Corralation between FEMALE HEALTH and NATIONAL HEALTHCARE

Assuming the 90 days trading horizon FEMALE HEALTH is expected to generate 1.55 times less return on investment than NATIONAL HEALTHCARE. In addition to that, FEMALE HEALTH is 2.5 times more volatile than NATIONAL HEALTHCARE. It trades about 0.02 of its total potential returns per unit of risk. NATIONAL HEALTHCARE is currently generating about 0.08 per unit of volatility. If you would invest  8,252  in NATIONAL HEALTHCARE on April 25, 2025 and sell it today you would earn a total of  548.00  from holding NATIONAL HEALTHCARE or generate 6.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	92.06%
Values	Daily Returns

FEMALE HEALTH  vs.  NATIONAL HEALTHCARE

FEMALE HEALTH

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FEMALE HEALTH are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, FEMALE HEALTH is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

NATIONAL HEALTHCARE

Risk-Adjusted Performance

Modest

Over the last 90 days NATIONAL HEALTHCARE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather fragile basic indicators, NATIONAL HEALTHCARE may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with FEMALE HEALTH and NATIONAL HEALTHCARE

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

The idea behind FEMALE HEALTH and NATIONAL HEALTHCARE 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 Global Correlations module to find global opportunities by holding instruments from different markets.