Correlation Between Sera Prognostics and Fonar

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

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

Diversification Opportunities for Sera Prognostics and Fonar

-0.57

Correlation Coefficient

Sera Prognostics  Fonar

Excellent diversification

The 3 months correlation between Sera and Fonar is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Sera Prognostics and Fonar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fonar and Sera Prognostics 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 Sera Prognostics are associated (or correlated) with Fonar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fonar has no effect on the direction of Sera Prognostics i.e., Sera Prognostics and Fonar go up and down completely randomly.

Pair Corralation between Sera Prognostics and Fonar

Given the investment horizon of 90 days Sera Prognostics is expected to under-perform the Fonar. In addition to that, Sera Prognostics is 3.3 times more volatile than Fonar. It trades about -0.42 of its total potential returns per unit of risk. Fonar is currently generating about 0.2 per unit of volatility. If you would invest  1,520  in Fonar on November 19, 2024 and sell it today you would earn a total of  105.00  from holding Fonar or generate 6.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Sera Prognostics  vs.  Fonar

Sera Prognostics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sera Prognostics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Fonar

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fonar are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Fonar may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with Sera Prognostics and Fonar

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

The idea behind Sera Prognostics and Fonar 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.