Correlation Between Evofem Biosciences and Rivian Automotive

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

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

Diversification Opportunities for Evofem Biosciences and Rivian Automotive

0.0

Correlation Coefficient

Evofem Biosciences  Rivian Automotive

Pay attention - limited upside

The 3 months correlation between Evofem and Rivian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Evofem Biosciences and Rivian Automotive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rivian Automotive and Evofem Biosciences 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 Evofem Biosciences are associated (or correlated) with Rivian Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rivian Automotive has no effect on the direction of Evofem Biosciences i.e., Evofem Biosciences and Rivian Automotive go up and down completely randomly.

Pair Corralation between Evofem Biosciences and Rivian Automotive

If you would invest  1,187  in Rivian Automotive on December 1, 2024 and sell it today you would lose (3.00) from holding Rivian Automotive or give up 0.25% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Evofem Biosciences  vs.  Rivian Automotive

Evofem Biosciences

Risk-Adjusted Performance

Very Weak

Over the last 90 days Evofem Biosciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Evofem Biosciences is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Rivian Automotive

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Rivian Automotive are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Rivian Automotive may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Evofem Biosciences and Rivian Automotive

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

The idea behind Evofem Biosciences and Rivian Automotive 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 Global Correlations module to find global opportunities by holding instruments from different markets.