Correlation Between ANI Pharmaceuticals and Esperion Therapeutics

Can any of the company-specific risk be diversified away by investing in both ANI Pharmaceuticals 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 ANI Pharmaceuticals and Esperion Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ANI Pharmaceuticals and Esperion Therapeutics, you can compare the effects of market volatilities on ANI Pharmaceuticals 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 ANI Pharmaceuticals with a short position of Esperion Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANI Pharmaceuticals and Esperion Therapeutics.

Diversification Opportunities for ANI Pharmaceuticals and Esperion Therapeutics

-0.68

Correlation Coefficient

ANI Pharmaceuticals  Esperion Therapeutics

Excellent diversification

The 3 months correlation between ANI and Esperion is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding ANI Pharmaceuticals and Esperion Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esperion Therapeutics and ANI Pharmaceuticals 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 ANI Pharmaceuticals 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 ANI Pharmaceuticals i.e., ANI Pharmaceuticals and Esperion Therapeutics go up and down completely randomly.

Pair Corralation between ANI Pharmaceuticals and Esperion Therapeutics

Given the investment horizon of 90 days ANI Pharmaceuticals is expected to generate 0.69 times more return on investment than Esperion Therapeutics. However, ANI Pharmaceuticals is 1.44 times less risky than Esperion Therapeutics. It trades about 0.16 of its potential returns per unit of risk. Esperion Therapeutics is currently generating about -0.14 per unit of risk. If you would invest  5,421  in ANI Pharmaceuticals on December 28, 2024 and sell it today you would earn a total of  1,340  from holding ANI Pharmaceuticals or generate 24.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

ANI Pharmaceuticals  vs.  Esperion Therapeutics

ANI Pharmaceuticals

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ANI Pharmaceuticals are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward indicators, ANI Pharmaceuticals reported solid returns over the last few months and may actually be approaching a breakup point.

Esperion Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Esperion Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with ANI Pharmaceuticals and Esperion Therapeutics

The main advantage of trading using opposite ANI Pharmaceuticals and Esperion Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANI Pharmaceuticals 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.

The idea behind ANI Pharmaceuticals and Esperion Therapeutics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.