Correlation Between Laboratory and Agilon Health
Can any of the company-specific risk be diversified away by investing in both Laboratory 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 Laboratory and Agilon Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Laboratory of and agilon health, you can compare the effects of market volatilities on Laboratory 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 Laboratory with a short position of Agilon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Laboratory and Agilon Health.
Diversification Opportunities for Laboratory and Agilon Health
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Laboratory and Agilon is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Laboratory of and agilon health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on agilon health and Laboratory 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 Laboratory of 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 Laboratory i.e., Laboratory and Agilon Health go up and down completely randomly.
Pair Corralation between Laboratory and Agilon Health
Allowing for the 90-day total investment horizon Laboratory of is expected to generate 0.12 times more return on investment than Agilon Health. However, Laboratory of is 8.66 times less risky than Agilon Health. It trades about 0.2 of its potential returns per unit of risk. agilon health is currently generating about -0.01 per unit of risk. If you would invest 22,987 in Laboratory of on August 31, 2024 and sell it today you would earn a total of 1,228 from holding Laboratory of or generate 5.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Laboratory of vs. agilon health
Performance |
| Timeline |
| Laboratory |
| agilon health |
Laboratory and Agilon Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Laboratory and Agilon Health
The main advantage of trading using opposite Laboratory and Agilon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Laboratory 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.| Laboratory vs. Quest Diagnostics Incorporated | Laboratory vs. Waters | Laboratory vs. Universal Health Services | Laboratory vs. Humana Inc |
| 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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