Correlation Between Sienna Senior and Agilon Health

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

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

Diversification Opportunities for Sienna Senior and Agilon Health

0.57

Correlation Coefficient

Sienna Senior  Agilon Health

Very weak diversification

The 3 months correlation between Sienna and Agilon is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Sienna Senior Living and agilon health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on agilon health and Sienna Senior 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 Sienna Senior Living 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 Sienna Senior i.e., Sienna Senior and Agilon Health go up and down completely randomly.

Pair Corralation between Sienna Senior and Agilon Health

Assuming the 90 days horizon Sienna Senior Living is expected to generate 0.31 times more return on investment than Agilon Health. However, Sienna Senior Living is 3.23 times less risky than Agilon Health. It trades about 0.11 of its potential returns per unit of risk. agilon health is currently generating about -0.08 per unit of risk. If you would invest  733.00  in Sienna Senior Living on October 1, 2024 and sell it today you would earn a total of  371.00  from holding Sienna Senior Living or generate 50.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	81.66%
Values	Daily Returns

Sienna Senior Living  vs.  agilon health

Sienna Senior Living

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sienna Senior Living has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

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 inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Sienna Senior and Agilon Health

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

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.