Correlation Between Esperion Therapeutics and Neogen
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and Neogen 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 Neogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and Neogen, you can compare the effects of market volatilities on Esperion Therapeutics and Neogen 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 Neogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and Neogen.
Diversification Opportunities for Esperion Therapeutics and Neogen
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Esperion and Neogen is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Neogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neogen 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 Neogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neogen has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Neogen go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and Neogen
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 1.54 times more return on investment than Neogen. However, Esperion Therapeutics is 1.54 times more volatile than Neogen. It trades about 0.06 of its potential returns per unit of risk. Neogen is currently generating about 0.02 per unit of risk. If you would invest 224.00 in Esperion Therapeutics on September 1, 2024 and sell it today you would earn a total of 56.00 from holding Esperion Therapeutics or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Esperion Therapeutics vs. Neogen
Performance |
| Timeline |
| Esperion Therapeutics |
| Neogen |
Esperion Therapeutics and Neogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and Neogen
The main advantage of trading using opposite Esperion Therapeutics and Neogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, Neogen 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 Neogen will offset losses from the drop in Neogen's long position.| Esperion Therapeutics vs. Tff Pharmaceuticals | Esperion Therapeutics vs. Eliem Therapeutics | Esperion Therapeutics vs. Inhibrx | Esperion Therapeutics vs. Enliven Therapeutics |
| Neogen vs. Qiagen NV | Neogen vs. Aclaris Therapeutics | Neogen vs. IQVIA Holdings | Neogen vs. Medpace Holdings |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |