Correlation Between Esperion Therapeutics and MYR
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and MYR 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 MYR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and MYR Group, you can compare the effects of market volatilities on Esperion Therapeutics and MYR 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 MYR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and MYR.
Diversification Opportunities for Esperion Therapeutics and MYR
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Esperion and MYR is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and MYR Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYR Group 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 MYR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYR Group has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and MYR go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and MYR
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 1.99 times more return on investment than MYR. However, Esperion Therapeutics is 1.99 times more volatile than MYR Group. It trades about 0.09 of its potential returns per unit of risk. MYR Group is currently generating about 0.04 per unit of risk. If you would invest 91.00 in Esperion Therapeutics on August 29, 2024 and sell it today you would earn a total of 163.00 from holding Esperion Therapeutics or generate 179.12% 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. MYR Group
Performance |
| Timeline |
| Esperion Therapeutics |
| MYR Group |
Esperion Therapeutics and MYR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and MYR
The main advantage of trading using opposite Esperion Therapeutics and MYR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, MYR 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 MYR will offset losses from the drop in MYR's long position.| Esperion Therapeutics vs. Elanco Animal Health | Esperion Therapeutics vs. SIGA Technologies | Esperion Therapeutics vs. Catalent | Esperion Therapeutics vs. ANI Pharmaceuticals |
| MYR vs. Comfort Systems USA | MYR vs. Granite Construction Incorporated | MYR vs. Dycom Industries | MYR vs. MasTec Inc |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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