Correlation Between Esperion Therapeutics and Alx Oncology
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and Alx Oncology 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 Esperion Therapeutics and Alx Oncology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and Alx Oncology Holdings, you can compare the effects of market volatilities on Esperion Therapeutics and Alx Oncology 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 Esperion Therapeutics with a short position of Alx Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and Alx Oncology.
Diversification Opportunities for Esperion Therapeutics and Alx Oncology
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Esperion and Alx is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Alx Oncology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alx Oncology Holdings and Esperion Therapeutics 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 Esperion Therapeutics are associated (or correlated) with Alx Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alx Oncology Holdings has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Alx Oncology go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and Alx Oncology
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 0.94 times more return on investment than Alx Oncology. However, Esperion Therapeutics is 1.06 times less risky than Alx Oncology. It trades about 0.01 of its potential returns per unit of risk. Alx Oncology Holdings is currently generating about -0.03 per unit of risk. If you would invest 537.00 in Esperion Therapeutics on September 2, 2024 and sell it today you would lose (257.00) from holding Esperion Therapeutics or give up 47.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Esperion Therapeutics vs. Alx Oncology Holdings
Performance |
| Timeline |
| Esperion Therapeutics |
| Alx Oncology Holdings |
Esperion Therapeutics and Alx Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and Alx Oncology
The main advantage of trading using opposite Esperion Therapeutics and Alx Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, Alx Oncology 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 Alx Oncology will offset losses from the drop in Alx Oncology's long position.| Esperion Therapeutics vs. Elanco Animal Health | Esperion Therapeutics vs. SIGA Technologies | Esperion Therapeutics vs. Catalent | Esperion Therapeutics vs. ANI Pharmaceuticals |
| Alx Oncology vs. Tff Pharmaceuticals | Alx Oncology vs. Eliem Therapeutics | Alx Oncology vs. Inhibrx | Alx Oncology vs. Enliven Therapeutics |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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