Correlation Between Agilon Health and Esperion Therapeutics
Can any of the company-specific risk be diversified away by investing in both Agilon Health and Esperion 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 Esperion 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 Esperion Therapeutics, you can compare the effects of market volatilities on Agilon Health and Esperion 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 Esperion Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilon Health and Esperion Therapeutics.
Diversification Opportunities for Agilon Health and Esperion Therapeutics
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Agilon and Esperion is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding agilon health and Esperion Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esperion 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 Esperion Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esperion Therapeutics has no effect on the direction of Agilon Health i.e., Agilon Health and Esperion Therapeutics go up and down completely randomly.
Pair Corralation between Agilon Health and Esperion Therapeutics
Considering the 90-day investment horizon agilon health is expected to under-perform the Esperion Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, agilon health is 1.25 times less risky than Esperion Therapeutics. The stock trades about -0.07 of its potential returns per unit of risk. The Esperion Therapeutics is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 749.00 in Esperion Therapeutics on August 24, 2024 and sell it today you would lose (497.00) from holding Esperion Therapeutics or give up 66.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
agilon health vs. Esperion Therapeutics
Performance |
| Timeline |
| agilon health |
| Esperion Therapeutics |
Agilon Health and Esperion Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilon Health and Esperion Therapeutics
The main advantage of trading using opposite Agilon Health and Esperion Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilon Health position performs unexpectedly, Esperion 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 Esperion Therapeutics will offset losses from the drop in Esperion Therapeutics' long position.| Agilon Health vs. Addus HomeCare | Agilon Health vs. Morningstar Unconstrained Allocation | Agilon Health vs. SEI Investments | Agilon Health vs. Goosehead Insurance |
| Esperion Therapeutics vs. Elanco Animal Health | Esperion Therapeutics vs. SIGA Technologies | Esperion Therapeutics vs. Catalent | Esperion Therapeutics vs. ANI 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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