Correlation Between Agile Thrpe and Eagle Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Agile Thrpe and Eagle Pharmaceuticals 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 Agile Thrpe and Eagle Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agile Thrpe and Eagle Pharmaceuticals, you can compare the effects of market volatilities on Agile Thrpe and Eagle Pharmaceuticals 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 Agile Thrpe with a short position of Eagle Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agile Thrpe and Eagle Pharmaceuticals.
Diversification Opportunities for Agile Thrpe and Eagle Pharmaceuticals
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Agile and Eagle is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Agile Thrpe and Eagle Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Pharmaceuticals and Agile Thrpe 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 Agile Thrpe are associated (or correlated) with Eagle Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Pharmaceuticals has no effect on the direction of Agile Thrpe i.e., Agile Thrpe and Eagle Pharmaceuticals go up and down completely randomly.
Pair Corralation between Agile Thrpe and Eagle Pharmaceuticals
Given the investment horizon of 90 days Agile Thrpe is expected to under-perform the Eagle Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Agile Thrpe is 1.63 times less risky than Eagle Pharmaceuticals. The stock trades about -0.22 of its potential returns per unit of risk. The Eagle Pharmaceuticals is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 1,994 in Eagle Pharmaceuticals on August 28, 2024 and sell it today you would lose (1,795) from holding Eagle Pharmaceuticals or give up 90.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.73% |
| Values | Daily Returns |
Agile Thrpe vs. Eagle Pharmaceuticals
Performance |
| Timeline |
| Agile Thrpe |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Eagle Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Agile Thrpe and Eagle Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agile Thrpe and Eagle Pharmaceuticals
The main advantage of trading using opposite Agile Thrpe and Eagle Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agile Thrpe position performs unexpectedly, Eagle Pharmaceuticals 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 Eagle Pharmaceuticals will offset losses from the drop in Eagle Pharmaceuticals' long position.| Agile Thrpe vs. Assertio Therapeutics | Agile Thrpe vs. Amneal Pharmaceuticals, Class | Agile Thrpe vs. Lifecore Biomedical | Agile Thrpe vs. Alpha Teknova |
| Eagle Pharmaceuticals vs. ANI Pharmaceuticals | Eagle Pharmaceuticals vs. Phibro Animal Health | Eagle Pharmaceuticals vs. Prestige Brand Holdings | Eagle Pharmaceuticals vs. Collegium Pharmaceutical |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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