Correlation Between Postal Realty and Esperion Therapeutics
Can any of the company-specific risk be diversified away by investing in both Postal Realty and Esperion Therapeutics 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 Postal Realty and Esperion Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Realty Trust and Esperion Therapeutics, you can compare the effects of market volatilities on Postal Realty and Esperion Therapeutics 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 Postal Realty with a short position of Esperion Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Realty and Esperion Therapeutics.
Diversification Opportunities for Postal Realty and Esperion Therapeutics
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Postal and Esperion is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Postal Realty Trust and Esperion Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esperion Therapeutics and Postal Realty 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 Postal Realty Trust are associated (or correlated) with Esperion Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esperion Therapeutics has no effect on the direction of Postal Realty i.e., Postal Realty and Esperion Therapeutics go up and down completely randomly.
Pair Corralation between Postal Realty and Esperion Therapeutics
Given the investment horizon of 90 days Postal Realty Trust is expected to generate 0.62 times more return on investment than Esperion Therapeutics. However, Postal Realty Trust is 1.61 times less risky than Esperion Therapeutics. It trades about -0.07 of its potential returns per unit of risk. Esperion Therapeutics is currently generating about -0.29 per unit of risk. If you would invest 1,285 in Postal Realty Trust on November 29, 2024 and sell it today you would lose (33.00) from holding Postal Realty Trust or give up 2.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Postal Realty Trust vs. Esperion Therapeutics
Performance |
| Timeline |
| Postal Realty Trust |
| Esperion Therapeutics |
Postal Realty and Esperion Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Postal Realty and Esperion Therapeutics
The main advantage of trading using opposite Postal Realty and Esperion Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Realty position performs unexpectedly, Esperion Therapeutics 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 Esperion Therapeutics will offset losses from the drop in Esperion Therapeutics' long position.| Postal Realty vs. Office Properties Income | Postal Realty vs. Boston Properties | Postal Realty vs. SL Green Realty | Postal Realty vs. Alexandria Real Estate |
| Esperion Therapeutics vs. Elanco Animal Health | Esperion Therapeutics vs. SIGA Technologies | Esperion Therapeutics vs. ANI Pharmaceuticals | Esperion Therapeutics vs. Phibro Animal Health |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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