Correlation Between Esperion Therapeutics and Talon Energy
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and Talon Energy 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 Talon Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and Talon Energy, you can compare the effects of market volatilities on Esperion Therapeutics and Talon Energy 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 Talon Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and Talon Energy.
Diversification Opportunities for Esperion Therapeutics and Talon Energy
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Esperion and Talon is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Talon Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talon Energy 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 Talon Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talon Energy has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Talon Energy go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and Talon Energy
If you would invest 290.00 in Esperion Therapeutics on August 25, 2024 and sell it today you would lose (38.00) from holding Esperion Therapeutics or give up 13.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.53% |
| Values | Daily Returns |
Esperion Therapeutics vs. Talon Energy
Performance |
| Timeline |
| Esperion Therapeutics |
| Talon Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Esperion Therapeutics and Talon Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Esperion Therapeutics and Talon Energy
The main advantage of trading using opposite Esperion Therapeutics and Talon Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, Talon Energy 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 Talon Energy will offset losses from the drop in Talon Energy's long position.| Esperion Therapeutics vs. Eliem Therapeutics | Esperion Therapeutics vs. HCW Biologics | Esperion Therapeutics vs. RenovoRx | Esperion Therapeutics vs. Scpharmaceuticals |
| Talon Energy vs. Esperion Therapeutics | Talon Energy vs. Merit Medical Systems | Talon Energy vs. Natural Alternatives International | Talon Energy vs. Village Super Market |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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