Correlation Between Esperion Therapeutics and Immatics

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

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

Diversification Opportunities for Esperion Therapeutics and Immatics

-0.73

Correlation Coefficient

Esperion Therapeutics  Immatics

Pay attention - limited upside

The 3 months correlation between Esperion and Immatics is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Esperion Therapeutics and Immatics NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Immatics NV 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 Immatics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Immatics NV has no effect on the direction of Esperion Therapeutics i.e., Esperion Therapeutics and Immatics go up and down completely randomly.

Pair Corralation between Esperion Therapeutics and Immatics

Given the investment horizon of 90 days Esperion Therapeutics is expected to generate 2.18 times more return on investment than Immatics. However, Esperion Therapeutics is 2.18 times more volatile than Immatics NV. It trades about 0.12 of its potential returns per unit of risk. Immatics NV is currently generating about -0.27 per unit of risk. If you would invest  175.00  in Esperion Therapeutics on September 19, 2024 and sell it today you would earn a total of  71.00  from holding Esperion Therapeutics or generate 40.57% 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.  Immatics NV

Esperion Therapeutics

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Esperion Therapeutics are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Esperion Therapeutics reported solid returns over the last few months and may actually be approaching a breakup point.

Immatics NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Immatics NV 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.

Pair Trading with Esperion Therapeutics and Immatics

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

The idea behind Esperion Therapeutics and Immatics NV 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.