Correlation Between Agilon Health and Sensus Healthcare
Can any of the company-specific risk be diversified away by investing in both Agilon Health and Sensus Healthcare 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 Sensus Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between agilon health and Sensus Healthcare, you can compare the effects of market volatilities on Agilon Health and Sensus Healthcare 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 Sensus Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilon Health and Sensus Healthcare.
Diversification Opportunities for Agilon Health and Sensus Healthcare
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Agilon and Sensus is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding agilon health and Sensus Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sensus Healthcare 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 Sensus Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sensus Healthcare has no effect on the direction of Agilon Health i.e., Agilon Health and Sensus Healthcare go up and down completely randomly.
Pair Corralation between Agilon Health and Sensus Healthcare
Considering the 90-day investment horizon agilon health is expected to under-perform the Sensus Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, agilon health is 1.07 times less risky than Sensus Healthcare. The stock trades about -0.08 of its potential returns per unit of risk. The Sensus Healthcare is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 882.00 in Sensus Healthcare on August 27, 2024 and sell it today you would earn a total of 7.00 from holding Sensus Healthcare or generate 0.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
agilon health vs. Sensus Healthcare
Performance |
| Timeline |
| agilon health |
| Sensus Healthcare |
Agilon Health and Sensus Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilon Health and Sensus Healthcare
The main advantage of trading using opposite Agilon Health and Sensus Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilon Health position performs unexpectedly, Sensus Healthcare 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 Sensus Healthcare will offset losses from the drop in Sensus Healthcare'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 |
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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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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