Correlation Between AcelRx Pharmaceuticals and VTv Therapeutics

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

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

Diversification Opportunities for AcelRx Pharmaceuticals and VTv Therapeutics

0.12

Correlation Coefficient

AcelRx Pharmaceuticals  VTv Therapeutics

Average diversification

The 3 months correlation between AcelRx and VTv is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding AcelRx Pharmaceuticals and vTv Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on vTv Therapeutics and AcelRx 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 AcelRx Pharmaceuticals are associated (or correlated) with VTv Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of vTv Therapeutics has no effect on the direction of AcelRx Pharmaceuticals i.e., AcelRx Pharmaceuticals and VTv Therapeutics go up and down completely randomly.

Pair Corralation between AcelRx Pharmaceuticals and VTv Therapeutics

If you would invest  1,538  in vTv Therapeutics on September 3, 2024 and sell it today you would earn a total of  66.00  from holding vTv Therapeutics or generate 4.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

AcelRx Pharmaceuticals  vs.  vTv Therapeutics

AcelRx Pharmaceuticals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AcelRx Pharmaceuticals has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, AcelRx Pharmaceuticals is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

vTv Therapeutics

Risk-Adjusted Performance

2 of 100

Weak

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

Pair Trading with AcelRx Pharmaceuticals and VTv Therapeutics

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

The idea behind AcelRx Pharmaceuticals and vTv Therapeutics 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.