Correlation Between Primary Health and EJF Investments
Can any of the company-specific risk be diversified away by investing in both Primary Health and EJF Investments 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 Primary Health and EJF Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Primary Health Properties and EJF Investments, you can compare the effects of market volatilities on Primary Health and EJF Investments 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 Primary Health with a short position of EJF Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Primary Health and EJF Investments.
Diversification Opportunities for Primary Health and EJF Investments
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Primary and EJF is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Primary Health Properties and EJF Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EJF Investments and Primary 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 Primary Health Properties are associated (or correlated) with EJF Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EJF Investments has no effect on the direction of Primary Health i.e., Primary Health and EJF Investments go up and down completely randomly.
Pair Corralation between Primary Health and EJF Investments
Assuming the 90 days trading horizon Primary Health is expected to generate 1.48 times less return on investment than EJF Investments. In addition to that, Primary Health is 1.25 times more volatile than EJF Investments. It trades about 0.05 of its total potential returns per unit of risk. EJF Investments is currently generating about 0.09 per unit of volatility. If you would invest 11,792 in EJF Investments on August 27, 2025 and sell it today you would earn a total of 558.00 from holding EJF Investments or generate 4.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Primary Health Properties vs. EJF Investments
Performance |
| Timeline |
| Primary Health Properties |
| EJF Investments |
Primary Health and EJF Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Primary Health and EJF Investments
The main advantage of trading using opposite Primary Health and EJF Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Primary Health position performs unexpectedly, EJF Investments 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 EJF Investments will offset losses from the drop in EJF Investments' long position.| Primary Health vs. EJF Investments | Primary Health vs. G5 Entertainment AB | Primary Health vs. Catena Media PLC | Primary Health vs. Flutter Entertainment PLC |
| EJF Investments vs. Toyota Motor Corp | EJF Investments vs. SoftBank Group Corp | EJF Investments vs. Cheniere Energy | EJF Investments vs. IDEXX Laboratories |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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