Correlation Between Esperion Therapeutics and LENSAR
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and LENSAR 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 LENSAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and LENSAR Inc, you can compare the effects of market volatilities on Esperion Therapeutics and LENSAR 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 LENSAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and LENSAR.
Diversification Opportunities for Esperion Therapeutics and LENSAR
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Esperion and LENSAR is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and LENSAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LENSAR Inc 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 LENSAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LENSAR Inc has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and LENSAR go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and LENSAR
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 1.71 times less return on investment than LENSAR. In addition to that, Esperion Therapeutics is 1.0 times more volatile than LENSAR Inc. It trades about 0.19 of its total potential returns per unit of risk. LENSAR Inc is currently generating about 0.32 per unit of volatility. If you would invest 530.00 in LENSAR Inc on August 26, 2024 and sell it today you would earn a total of 208.00 from holding LENSAR Inc or generate 39.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Esperion Therapeutics vs. LENSAR Inc
Performance |
| Timeline |
| Esperion Therapeutics |
| LENSAR Inc |
Esperion Therapeutics and LENSAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and LENSAR
The main advantage of trading using opposite Esperion Therapeutics and LENSAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, LENSAR 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 LENSAR will offset losses from the drop in LENSAR's long position.| Esperion Therapeutics vs. Eliem Therapeutics | Esperion Therapeutics vs. HCW Biologics | Esperion Therapeutics vs. Scpharmaceuticals | Esperion Therapeutics vs. Milestone Pharmaceuticals |
| LENSAR vs. Heartbeam | LENSAR vs. EUDA Health Holdings | LENSAR vs. Nutex Health | LENSAR vs. Healthcare Triangle |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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