Correlation Between Esperion Therapeutics and Star Equity
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and Star Equity 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 Star Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and Star Equity Holdings, you can compare the effects of market volatilities on Esperion Therapeutics and Star Equity 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 Star Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and Star Equity.
Diversification Opportunities for Esperion Therapeutics and Star Equity
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Esperion and Star is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Star Equity Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Star Equity 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 Star Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Star Equity Holdings has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Star Equity go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and Star Equity
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 1.61 times more return on investment than Star Equity. However, Esperion Therapeutics is 1.61 times more volatile than Star Equity Holdings. It trades about 0.01 of its potential returns per unit of risk. Star Equity Holdings is currently generating about -0.01 per unit of risk. If you would invest 560.00 in Esperion Therapeutics on September 3, 2024 and sell it today you would lose (280.00) from holding Esperion Therapeutics or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Esperion Therapeutics vs. Star Equity Holdings
Performance |
| Timeline |
| Esperion Therapeutics |
| Star Equity Holdings |
Esperion Therapeutics and Star Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and Star Equity
The main advantage of trading using opposite Esperion Therapeutics and Star Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, Star Equity 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 Star Equity will offset losses from the drop in Star Equity's long position.| Esperion Therapeutics vs. Elanco Animal Health | Esperion Therapeutics vs. SIGA Technologies | Esperion Therapeutics vs. Catalent | Esperion Therapeutics vs. ANI Pharmaceuticals |
| Star Equity vs. Volitionrx | Star Equity vs. Biodesix | Star Equity vs. Fonar | Star Equity vs. Burning Rock Biotech |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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