Correlation Between Evolent Health and Axogen
Can any of the company-specific risk be diversified away by investing in both Evolent Health and Axogen 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 Evolent Health and Axogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evolent Health and Axogen Inc, you can compare the effects of market volatilities on Evolent Health and Axogen 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 Evolent Health with a short position of Axogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolent Health and Axogen.
Diversification Opportunities for Evolent Health and Axogen
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Evolent and Axogen is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Evolent Health and Axogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axogen Inc and Evolent Health 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 Evolent Health are associated (or correlated) with Axogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axogen Inc has no effect on the direction of Evolent Health i.e., Evolent Health and Axogen go up and down completely randomly.
Pair Corralation between Evolent Health and Axogen
Considering the 90-day investment horizon Evolent Health is expected to under-perform the Axogen. But the stock apears to be less risky and, when comparing its historical volatility, Evolent Health is 1.23 times less risky than Axogen. The stock trades about -0.32 of its potential returns per unit of risk. The Axogen Inc is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,527 in Axogen Inc on November 9, 2024 and sell it today you would earn a total of 306.00 from holding Axogen Inc or generate 20.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evolent Health vs. Axogen Inc
Performance |
| Timeline |
| Evolent Health |
| Axogen Inc |
Evolent Health and Axogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evolent Health and Axogen
The main advantage of trading using opposite Evolent Health and Axogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evolent Health position performs unexpectedly, Axogen 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 Axogen will offset losses from the drop in Axogen's long position.| Evolent Health vs. CareMax | Evolent Health vs. Certara | Evolent Health vs. Definitive Healthcare Corp | Evolent Health vs. National Research Corp |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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