Correlation Between Agilon Health and Tandem Diabetes
Can any of the company-specific risk be diversified away by investing in both Agilon Health and Tandem Diabetes 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 Tandem Diabetes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between agilon health and Tandem Diabetes Care, you can compare the effects of market volatilities on Agilon Health and Tandem Diabetes 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 Tandem Diabetes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilon Health and Tandem Diabetes.
Diversification Opportunities for Agilon Health and Tandem Diabetes
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Agilon and Tandem is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding agilon health and Tandem Diabetes Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tandem Diabetes Care 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 Tandem Diabetes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tandem Diabetes Care has no effect on the direction of Agilon Health i.e., Agilon Health and Tandem Diabetes go up and down completely randomly.
Pair Corralation between Agilon Health and Tandem Diabetes
Considering the 90-day investment horizon agilon health is expected to under-perform the Tandem Diabetes. In addition to that, Agilon Health is 2.89 times more volatile than Tandem Diabetes Care. It trades about -0.02 of its total potential returns per unit of risk. Tandem Diabetes Care is currently generating about -0.05 per unit of volatility. If you would invest 3,293 in Tandem Diabetes Care on August 30, 2024 and sell it today you would lose (171.00) from holding Tandem Diabetes Care or give up 5.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
agilon health vs. Tandem Diabetes Care
Performance |
| Timeline |
| agilon health |
| Tandem Diabetes Care |
Agilon Health and Tandem Diabetes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilon Health and Tandem Diabetes
The main advantage of trading using opposite Agilon Health and Tandem Diabetes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilon Health position performs unexpectedly, Tandem Diabetes 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 Tandem Diabetes will offset losses from the drop in Tandem Diabetes' long position.| Agilon Health vs. Humana Inc | Agilon Health vs. Cigna Corp | Agilon Health vs. Elevance Health | Agilon Health vs. Centene Corp |
| Tandem Diabetes vs. ReShape Lifesciences | Tandem Diabetes vs. Bone Biologics Corp | Tandem Diabetes vs. Tivic Health Systems | Tandem Diabetes vs. Nuwellis |
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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