Correlation Between Amn Healthcare and Agilon Health

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Can any of the company-specific risk be diversified away by investing in both Amn Healthcare 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 Amn Healthcare and Agilon Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amn Healthcare Services and Agilon Health, you can compare the effects of market volatilities on Amn Healthcare 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 Amn Healthcare with a short position of Agilon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amn Healthcare and Agilon Health.

Diversification Opportunities for Amn Healthcare and Agilon Health

0.75
  Correlation Coefficient

Poor diversification

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

Pair Corralation between Amn Healthcare and Agilon Health

Considering the 90-day investment horizon Amn Healthcare is expected to generate 18.11 times less return on investment than Agilon Health. But when comparing it to its historical volatility, Amn Healthcare Services is 1.56 times less risky than Agilon Health. It trades about 0.02 of its potential returns per unit of risk. Agilon Health is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  2,042  in Agilon Health on July 1, 2022 and sell it today you would earn a total of  302.00  from holding Agilon Health or generate 14.79% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Amn Healthcare Services  vs.  Agilon Health

 Performance (%) 
       Timeline  
Amn Healthcare Services 
Amn Healthcare Performance
0 of 100
Over the last 90 days Amn Healthcare Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, Amn Healthcare is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Amn Healthcare Price Channel

Agilon Health 
Agilon Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Agilon Health are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting technical and fundamental indicators, Agilon Health may actually be approaching a critical reversion point that can send shares even higher in October 2022.

Agilon Price Channel

Amn Healthcare and Agilon Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Amn Healthcare and Agilon Health

The main advantage of trading using opposite Amn Healthcare and Agilon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amn Healthcare 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.
Amn Healthcare vs. Amazon Inc
The idea behind Amn Healthcare Services 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.
Agilon Health vs. Amazon Inc
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

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