Correlation Between Agilon Health and Evotec SE
Can any of the company-specific risk be diversified away by investing in both Agilon Health and Evotec SE 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 Evotec SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between agilon health and Evotec SE ADR, you can compare the effects of market volatilities on Agilon Health and Evotec SE 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 Evotec SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilon Health and Evotec SE.
Diversification Opportunities for Agilon Health and Evotec SE
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Agilon and Evotec is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding agilon health and Evotec SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evotec SE ADR 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 Evotec SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evotec SE ADR has no effect on the direction of Agilon Health i.e., Agilon Health and Evotec SE go up and down completely randomly.
Pair Corralation between Agilon Health and Evotec SE
Considering the 90-day investment horizon agilon health is expected to under-perform the Evotec SE. In addition to that, Agilon Health is 1.2 times more volatile than Evotec SE ADR. It trades about -0.07 of its total potential returns per unit of risk. Evotec SE ADR is currently generating about -0.01 per unit of volatility. If you would invest 832.00 in Evotec SE ADR on August 27, 2024 and sell it today you would lose (383.00) from holding Evotec SE ADR or give up 46.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
agilon health vs. Evotec SE ADR
Performance |
| Timeline |
| agilon health |
| Evotec SE ADR |
Agilon Health and Evotec SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilon Health and Evotec SE
The main advantage of trading using opposite Agilon Health and Evotec SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilon Health position performs unexpectedly, Evotec SE 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 Evotec SE will offset losses from the drop in Evotec SE's 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 |
| Evotec SE vs. Eliem Therapeutics | Evotec SE vs. HCW Biologics | Evotec SE vs. Scpharmaceuticals | Evotec SE 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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