Correlation Between Evolve Global and TD Global

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

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

Diversification Opportunities for Evolve Global and TD Global

0.8

Correlation Coefficient

Evolve Global  TD Global

Very poor diversification

The 3 months correlation between Evolve and TDOC is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Evolve Global Healthcare and TD Global Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TD Global Healthcare and Evolve Global 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 Evolve Global Healthcare are associated (or correlated) with TD Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TD Global Healthcare has no effect on the direction of Evolve Global i.e., Evolve Global and TD Global go up and down completely randomly.

Pair Corralation between Evolve Global and TD Global

Assuming the 90 days trading horizon Evolve Global Healthcare is expected to generate 1.16 times more return on investment than TD Global. However, Evolve Global is 1.16 times more volatile than TD Global Healthcare. It trades about 0.05 of its potential returns per unit of risk. TD Global Healthcare is currently generating about 0.02 per unit of risk. If you would invest  1,773  in Evolve Global Healthcare on April 22, 2025 and sell it today you would earn a total of  48.00  from holding Evolve Global Healthcare or generate 2.71% return on investment over 90 days.

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

Evolve Global Healthcare  vs.  TD Global Healthcare

Evolve Global Healthcare

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Evolve Global Healthcare are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Evolve Global is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

TD Global Healthcare

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TD Global Healthcare are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, TD Global is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Evolve Global and TD Global

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

The idea behind Evolve Global Healthcare and TD Global 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.