Correlation Between Eagle Pharmaceuticals and Regional Health

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

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

Diversification Opportunities for Eagle Pharmaceuticals and Regional Health

-0.43

Correlation Coefficient

Eagle Pharmaceuticals  Regional Health

Very good diversification

The 3 months correlation between Eagle and Regional is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Pharmaceuticals and Regional Health Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regional Health Prop and Eagle 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 Eagle Pharmaceuticals are associated (or correlated) with Regional Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regional Health Prop has no effect on the direction of Eagle Pharmaceuticals i.e., Eagle Pharmaceuticals and Regional Health go up and down completely randomly.

Pair Corralation between Eagle Pharmaceuticals and Regional Health

If you would invest  46.00  in Regional Health Properties on September 5, 2024 and sell it today you would earn a total of  14.00  from holding Regional Health Properties or generate 30.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	4.55%
Values	Daily Returns

Eagle Pharmaceuticals  vs.  Regional Health Properties

Eagle Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eagle Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Regional Health Prop

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Regional Health Properties are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady technical and fundamental indicators, Regional Health sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eagle Pharmaceuticals and Regional Health

The main advantage of trading using opposite Eagle Pharmaceuticals and Regional Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Pharmaceuticals position performs unexpectedly, Regional 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 Regional Health will offset losses from the drop in Regional Health's long position.

The idea behind Eagle Pharmaceuticals and Regional Health Properties 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.