Correlation Between TSOGO SUN and Evolent Health

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

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

Diversification Opportunities for TSOGO SUN and Evolent Health

-0.44

Correlation Coefficient

TSOGO SUN  Evolent Health

Very good diversification

The 3 months correlation between TSOGO and Evolent is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding TSOGO SUN GAMING and Evolent Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolent Health and TSOGO SUN 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 TSOGO SUN GAMING are associated (or correlated) with Evolent Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolent Health has no effect on the direction of TSOGO SUN i.e., TSOGO SUN and Evolent Health go up and down completely randomly.

Pair Corralation between TSOGO SUN and Evolent Health

Assuming the 90 days horizon TSOGO SUN GAMING is expected to under-perform the Evolent Health. But the stock apears to be less risky and, when comparing its historical volatility, TSOGO SUN GAMING is 2.73 times less risky than Evolent Health. The stock trades about -0.04 of its potential returns per unit of risk. The Evolent Health is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  755.00  in Evolent Health on April 23, 2025 and sell it today you would earn a total of  55.00  from holding Evolent Health or generate 7.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

TSOGO SUN GAMING  vs.  Evolent Health

TSOGO SUN GAMING

Risk-Adjusted Performance

Very Weak

Over the last 90 days TSOGO SUN GAMING has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, TSOGO SUN is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Evolent Health

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Evolent Health are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Evolent Health reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with TSOGO SUN and Evolent Health

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

The idea behind TSOGO SUN GAMING and Evolent Health 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.