Correlation Between Agilon Health and Alvotech Warrant
Can any of the company-specific risk be diversified away by investing in both Agilon Health and Alvotech Warrant 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 Agilon Health and Alvotech Warrant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between agilon health and Alvotech Warrant, you can compare the effects of market volatilities on Agilon Health and Alvotech Warrant 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 Agilon Health with a short position of Alvotech Warrant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilon Health and Alvotech Warrant.
Diversification Opportunities for Agilon Health and Alvotech Warrant
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agilon and Alvotech is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding agilon health and Alvotech Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alvotech Warrant and Agilon 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 agilon health are associated (or correlated) with Alvotech Warrant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alvotech Warrant has no effect on the direction of Agilon Health i.e., Agilon Health and Alvotech Warrant go up and down completely randomly.
Pair Corralation between Agilon Health and Alvotech Warrant
Considering the 90-day investment horizon agilon health is expected to under-perform the Alvotech Warrant. But the stock apears to be less risky and, when comparing its historical volatility, agilon health is 12.01 times less risky than Alvotech Warrant. The stock trades about -0.09 of its potential returns per unit of risk. The Alvotech Warrant is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 199.00 in Alvotech Warrant on August 27, 2024 and sell it today you would earn a total of 101.00 from holding Alvotech Warrant or generate 50.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.08% |
| Values | Daily Returns |
agilon health vs. Alvotech Warrant
Performance |
| Timeline |
| agilon health |
| Alvotech Warrant |
Agilon Health and Alvotech Warrant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilon Health and Alvotech Warrant
The main advantage of trading using opposite Agilon Health and Alvotech Warrant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilon Health position performs unexpectedly, Alvotech Warrant 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 Alvotech Warrant will offset losses from the drop in Alvotech Warrant's long position.The idea behind agilon health and Alvotech Warrant 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.| Alvotech Warrant vs. Eliem Therapeutics | Alvotech Warrant vs. HCW Biologics | Alvotech Warrant vs. Scpharmaceuticals | Alvotech Warrant vs. Milestone Pharmaceuticals |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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