Correlation Between Esperion Therapeutics and Inovio Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and Inovio 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 Esperion Therapeutics and Inovio Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and Inovio Pharmaceuticals, you can compare the effects of market volatilities on Esperion Therapeutics and Inovio 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 Esperion Therapeutics with a short position of Inovio Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and Inovio Pharmaceuticals.
Diversification Opportunities for Esperion Therapeutics and Inovio Pharmaceuticals
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Esperion and Inovio is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Inovio Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inovio Pharmaceuticals 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 Inovio Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inovio Pharmaceuticals has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Inovio Pharmaceuticals go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and Inovio Pharmaceuticals
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 1.0 times more return on investment than Inovio Pharmaceuticals. However, Esperion Therapeutics is 1.0 times more volatile than Inovio Pharmaceuticals. It trades about 0.07 of its potential returns per unit of risk. Inovio Pharmaceuticals is currently generating about -0.02 per unit of risk. If you would invest 122.00 in Esperion Therapeutics on September 14, 2024 and sell it today you would earn a total of 103.00 from holding Esperion Therapeutics or generate 84.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Esperion Therapeutics vs. Inovio Pharmaceuticals
Performance |
| Timeline |
| Esperion Therapeutics |
| Inovio Pharmaceuticals |
Esperion Therapeutics and Inovio Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and Inovio Pharmaceuticals
The main advantage of trading using opposite Esperion Therapeutics and Inovio Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, Inovio 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 Inovio Pharmaceuticals will offset losses from the drop in Inovio Pharmaceuticals' long position.| Esperion Therapeutics vs. Elanco Animal Health | Esperion Therapeutics vs. SIGA Technologies | Esperion Therapeutics vs. Catalent | Esperion Therapeutics vs. ANI Pharmaceuticals |
| Inovio Pharmaceuticals vs. Puma Biotechnology | Inovio Pharmaceuticals vs. Iovance Biotherapeutics | Inovio Pharmaceuticals vs. Day One Biopharmaceuticals | Inovio Pharmaceuticals vs. Inozyme Pharma |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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