Correlation Between Agilon Health and Dyne Therapeutics
Can any of the company-specific risk be diversified away by investing in both Agilon Health and Dyne Therapeutics 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 Dyne Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between agilon health and Dyne Therapeutics, you can compare the effects of market volatilities on Agilon Health and Dyne Therapeutics 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 Dyne Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilon Health and Dyne Therapeutics.
Diversification Opportunities for Agilon Health and Dyne Therapeutics
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Agilon and Dyne is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding agilon health and Dyne Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dyne Therapeutics 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 Dyne Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dyne Therapeutics has no effect on the direction of Agilon Health i.e., Agilon Health and Dyne Therapeutics go up and down completely randomly.
Pair Corralation between Agilon Health and Dyne Therapeutics
Considering the 90-day investment horizon agilon health is expected to under-perform the Dyne Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, agilon health is 1.02 times less risky than Dyne Therapeutics. The stock trades about -0.06 of its potential returns per unit of risk. The Dyne Therapeutics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,072 in Dyne Therapeutics on August 30, 2024 and sell it today you would earn a total of 2,041 from holding Dyne Therapeutics or generate 190.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
agilon health vs. Dyne Therapeutics
Performance |
| Timeline |
| agilon health |
| Dyne Therapeutics |
Agilon Health and Dyne Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilon Health and Dyne Therapeutics
The main advantage of trading using opposite Agilon Health and Dyne Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilon Health position performs unexpectedly, Dyne Therapeutics 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 Dyne Therapeutics will offset losses from the drop in Dyne Therapeutics' long position.| Agilon Health vs. The Ensign Group | Agilon Health vs. Universal Health Services | Agilon Health vs. Addus HomeCare | Agilon Health vs. Encompass Health Corp |
| Dyne Therapeutics vs. Stoke Therapeutics | Dyne Therapeutics vs. Pliant Therapeutics | Dyne Therapeutics vs. Cytokinetics | Dyne Therapeutics vs. Revolution Medicines |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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