Correlation Between Alpha Tau and Axogen

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

By analyzing existing cross correlation between Alpha Tau Medical and Axogen Inc, you can compare the effects of market volatilities on Alpha Tau and Axogen 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 Alpha Tau with a short position of Axogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Tau and Axogen.

Diversification Opportunities for Alpha Tau and Axogen

0.45

Correlation Coefficient

Alpha Tau  Axogen

Very weak diversification

The 3 months correlation between Alpha and Axogen is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Tau Medical and Axogen Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axogen Inc and Alpha Tau 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 Alpha Tau Medical are associated (or correlated) with Axogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axogen Inc has no effect on the direction of Alpha Tau i.e., Alpha Tau and Axogen go up and down completely randomly.

Pair Corralation between Alpha Tau and Axogen

Given the investment horizon of 90 days Alpha Tau is expected to generate 4.29 times less return on investment than Axogen. In addition to that, Alpha Tau is 1.06 times more volatile than Axogen Inc. It trades about 0.03 of its total potential returns per unit of risk. Axogen Inc is currently generating about 0.15 per unit of volatility. If you would invest  1,176  in Axogen Inc on May 17, 2025 and sell it today you would earn a total of  314.00  from holding Axogen Inc or generate 26.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Alpha Tau Medical  vs.  Axogen Inc

Alpha Tau Medical

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Tau Medical are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal basic indicators, Alpha Tau may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Axogen Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Axogen Inc are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Axogen displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Alpha Tau and Axogen

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

The idea behind Alpha Tau Medical and Axogen Inc 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.