Correlation Between Sera Prognostics and OncoCyte Corp

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

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

Diversification Opportunities for Sera Prognostics and OncoCyte Corp

-0.61

Correlation Coefficient

Sera Prognostics  OncoCyte Corp

Excellent diversification

The 3 months correlation between Sera and OncoCyte is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sera Prognostics and OncoCyte Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OncoCyte Corp 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 OncoCyte Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OncoCyte Corp has no effect on the direction of Sera Prognostics i.e., Sera Prognostics and OncoCyte Corp go up and down completely randomly.

Pair Corralation between Sera Prognostics and OncoCyte Corp

Given the investment horizon of 90 days Sera Prognostics is expected to under-perform the OncoCyte Corp. In addition to that, Sera Prognostics is 1.02 times more volatile than OncoCyte Corp. It trades about -0.26 of its total potential returns per unit of risk. OncoCyte Corp is currently generating about 0.11 per unit of volatility. If you would invest  245.00  in OncoCyte Corp on December 28, 2024 and sell it today you would earn a total of  76.00  from holding OncoCyte Corp or generate 31.02% return on investment over 90 days.

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

Sera Prognostics  vs.  OncoCyte Corp

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 April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

OncoCyte Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in OncoCyte Corp are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental indicators, OncoCyte Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sera Prognostics and OncoCyte Corp

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

The idea behind Sera Prognostics and OncoCyte Corp 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.