Correlation Between Esperion Therapeutics and Titan Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Esperion Therapeutics and Titan Pharmaceuticals 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 Esperion Therapeutics and Titan Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Esperion Therapeutics and Titan Pharmaceuticals, you can compare the effects of market volatilities on Esperion Therapeutics and Titan Pharmaceuticals 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 Esperion Therapeutics with a short position of Titan Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Esperion Therapeutics and Titan Pharmaceuticals.
Diversification Opportunities for Esperion Therapeutics and Titan Pharmaceuticals
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Esperion and Titan is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Titan Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Titan Pharmaceuticals and Esperion Therapeutics 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 Esperion Therapeutics are associated (or correlated) with Titan Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Titan Pharmaceuticals has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Titan Pharmaceuticals go up and down completely randomly.
Pair Corralation between Esperion Therapeutics and Titan Pharmaceuticals
Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 1.76 times more return on investment than Titan Pharmaceuticals. However, Esperion Therapeutics is 1.76 times more volatile than Titan Pharmaceuticals. It trades about 0.18 of its potential returns per unit of risk. Titan Pharmaceuticals is currently generating about -0.18 per unit of risk. If you would invest 175.00 in Esperion Therapeutics on September 12, 2024 and sell it today you would earn a total of 129.00 from holding Esperion Therapeutics or generate 73.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Esperion Therapeutics vs. Titan Pharmaceuticals
Performance |
Timeline |
Esperion Therapeutics |
Titan Pharmaceuticals |
Esperion Therapeutics and Titan Pharmaceuticals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Esperion Therapeutics and Titan Pharmaceuticals
The main advantage of trading using opposite Esperion Therapeutics and Titan Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Esperion Therapeutics position performs unexpectedly, Titan Pharmaceuticals 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 Titan Pharmaceuticals will offset losses from the drop in Titan Pharmaceuticals' long position.Esperion Therapeutics vs. Evoke Pharma | Esperion Therapeutics vs. Dynavax Technologies | Esperion Therapeutics vs. Lantheus Holdings | Esperion Therapeutics vs. ANI Pharmaceuticals |
Titan Pharmaceuticals vs. Salarius Pharmaceuticals | Titan Pharmaceuticals vs. SAB Biotherapeutics | Titan Pharmaceuticals vs. Vaccinex | Titan Pharmaceuticals vs. GeoVax Labs |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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