Correlation Between Eventide Healthcare and Us Small

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

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

Diversification Opportunities for Eventide Healthcare and Us Small

0.78

Correlation Coefficient

Eventide Healthcare  Us Small

Poor diversification

The 3 months correlation between Eventide and DFSTX is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Eventide Healthcare Life and Us Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Us Small Cap and Eventide Healthcare 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 Eventide Healthcare Life are associated (or correlated) with Us Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Us Small Cap has no effect on the direction of Eventide Healthcare i.e., Eventide Healthcare and Us Small go up and down completely randomly.

Pair Corralation between Eventide Healthcare and Us Small

Assuming the 90 days horizon Eventide Healthcare is expected to generate 1.32 times less return on investment than Us Small. In addition to that, Eventide Healthcare is 1.41 times more volatile than Us Small Cap. It trades about 0.1 of its total potential returns per unit of risk. Us Small Cap is currently generating about 0.19 per unit of volatility. If you would invest  4,386  in Us Small Cap on May 1, 2025 and sell it today you would earn a total of  558.00  from holding Us Small Cap or generate 12.72% return on investment over 90 days.

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

Eventide Healthcare Life  vs.  Us Small Cap

Eventide Healthcare Life

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Eventide Healthcare Life are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical indicators, Eventide Healthcare may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Us Small Cap

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Us Small Cap are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Us Small showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eventide Healthcare and Us Small

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

The idea behind Eventide Healthcare Life and Us Small Cap 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.