Correlation Between Fresenius and Agilon Health
Can any of the company-specific risk be diversified away by investing in both Fresenius and Agilon Health 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 Fresenius and Agilon Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fresenius SE Co and agilon health, you can compare the effects of market volatilities on Fresenius and Agilon Health 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 Fresenius with a short position of Agilon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fresenius and Agilon Health.
Diversification Opportunities for Fresenius and Agilon Health
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Fresenius and Agilon is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Fresenius SE Co and agilon health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on agilon health and Fresenius 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 Fresenius SE Co are associated (or correlated) with Agilon Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of agilon health has no effect on the direction of Fresenius i.e., Fresenius and Agilon Health go up and down completely randomly.
Pair Corralation between Fresenius and Agilon Health
Assuming the 90 days horizon Fresenius SE Co is expected to generate 0.12 times more return on investment than Agilon Health. However, Fresenius SE Co is 8.08 times less risky than Agilon Health. It trades about -0.12 of its potential returns per unit of risk. agilon health is currently generating about -0.03 per unit of risk. If you would invest 917.00 in Fresenius SE Co on September 1, 2024 and sell it today you would lose (34.00) from holding Fresenius SE Co or give up 3.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fresenius SE Co vs. agilon health
Performance |
| Timeline |
| Fresenius SE |
| agilon health |
Fresenius and Agilon Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fresenius and Agilon Health
The main advantage of trading using opposite Fresenius and Agilon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fresenius position performs unexpectedly, Agilon Health 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 Agilon Health will offset losses from the drop in Agilon Health's long position.| Fresenius vs. Jack Nathan Medical | Fresenius vs. Medical Facilities | Fresenius vs. Ramsay Health Care | Fresenius vs. Nova Leap Health |
| Agilon Health vs. The Ensign Group | Agilon Health vs. Universal Health Services | Agilon Health vs. Addus HomeCare | Agilon Health vs. Encompass Health 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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