Correlation Between Doximity and Agilon Health

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

By analyzing existing cross correlation between Doximity and agilon health, you can compare the effects of market volatilities on Doximity 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 Doximity with a short position of Agilon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doximity and Agilon Health.

Diversification Opportunities for Doximity and Agilon Health

-0.75

Correlation Coefficient

Doximity  Agilon Health

Pay attention - limited upside

The 3 months correlation between Doximity and Agilon is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Doximity and agilon health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on agilon health and Doximity 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 Doximity 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 Doximity i.e., Doximity and Agilon Health go up and down completely randomly.

Pair Corralation between Doximity and Agilon Health

Given the investment horizon of 90 days Doximity is expected to generate 0.73 times more return on investment than Agilon Health. However, Doximity is 1.38 times less risky than Agilon Health. It trades about 0.05 of its potential returns per unit of risk. agilon health is currently generating about -0.08 per unit of risk. If you would invest  3,438  in Doximity on October 3, 2024 and sell it today you would earn a total of  1,901  from holding Doximity or generate 55.29% return on investment over 90 days.

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

Doximity  vs.  agilon health

Doximity

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Doximity are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady fundamental indicators, Doximity unveiled solid returns over the last few months and may actually be approaching a breakup point.

agilon health

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days agilon health has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Doximity and Agilon Health

The main advantage of trading using opposite Doximity and Agilon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doximity 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.

The idea behind Doximity and agilon health 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.