Correlation Between Inogen and Paragon 28

Can any of the company-specific risk be diversified away by investing in both Inogen and Paragon 28 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 Inogen and Paragon 28 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Inogen Inc and Paragon 28, you can compare the effects of market volatilities on Inogen and Paragon 28 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 Inogen with a short position of Paragon 28. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inogen and Paragon 28.

Diversification Opportunities for Inogen and Paragon 28

0.55

Correlation Coefficient

Inogen  Paragon 28

Very weak diversification

The 3 months correlation between Inogen and Paragon is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Inogen Inc and Paragon 28 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Paragon 28 and Inogen 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 Inogen Inc are associated (or correlated) with Paragon 28. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Paragon 28 has no effect on the direction of Inogen i.e., Inogen and Paragon 28 go up and down completely randomly.

Pair Corralation between Inogen and Paragon 28

Given the investment horizon of 90 days Inogen Inc is expected to under-perform the Paragon 28. In addition to that, Inogen is 15.51 times more volatile than Paragon 28. It trades about -0.13 of its total potential returns per unit of risk. Paragon 28 is currently generating about 0.1 per unit of volatility. If you would invest  1,303  in Paragon 28 on February 17, 2025 and sell it today you would earn a total of  6.00  from holding Paragon 28 or generate 0.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	53.49%
Values	Daily Returns

Inogen Inc  vs.  Paragon 28

Inogen Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Inogen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain very healthy which may send shares a bit higher in June 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Paragon 28

Risk-Adjusted Performance

Weak

Over the last 90 days Paragon 28 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Paragon 28 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Inogen and Paragon 28

The main advantage of trading using opposite Inogen and Paragon 28 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inogen position performs unexpectedly, Paragon 28 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 Paragon 28 will offset losses from the drop in Paragon 28's long position.

The idea behind Inogen Inc and Paragon 28 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.