Correlation Between Masimo and HealthEquity
Can any of the company-specific risk be diversified away by investing in both Masimo and HealthEquity 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 Masimo and HealthEquity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Masimo and HealthEquity, you can compare the effects of market volatilities on Masimo and HealthEquity 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 Masimo with a short position of HealthEquity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Masimo and HealthEquity.
Diversification Opportunities for Masimo and HealthEquity
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Masimo and HealthEquity is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Masimo and HealthEquity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HealthEquity and Masimo 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 Masimo are associated (or correlated) with HealthEquity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HealthEquity has no effect on the direction of Masimo i.e., Masimo and HealthEquity go up and down completely randomly.
Pair Corralation between Masimo and HealthEquity
Given the investment horizon of 90 days Masimo is expected to under-perform the HealthEquity. But the stock apears to be less risky and, when comparing its historical volatility, Masimo is 1.19 times less risky than HealthEquity. The stock trades about -0.02 of its potential returns per unit of risk. The HealthEquity is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 8,743 in HealthEquity on August 14, 2025 and sell it today you would earn a total of 1,240 from holding HealthEquity or generate 14.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Masimo vs. HealthEquity
Performance |
| Timeline |
| Masimo |
| HealthEquity |
Masimo and HealthEquity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Masimo and HealthEquity
The main advantage of trading using opposite Masimo and HealthEquity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Masimo position performs unexpectedly, HealthEquity 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 HealthEquity will offset losses from the drop in HealthEquity's long position.The idea behind Masimo and HealthEquity 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.| HealthEquity vs. Globus Medical | HealthEquity vs. Molina Healthcare | HealthEquity vs. Penumbra | HealthEquity vs. BrightSpring Health Services, |
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 CEOs Directory module to screen CEOs from public companies around the world.
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