Correlation Between Tivic Health and Vapotherm

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

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

Diversification Opportunities for Tivic Health and Vapotherm

-0.17

Correlation Coefficient

Tivic Health  Vapotherm

Good diversification

The 3 months correlation between Tivic and Vapotherm is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Tivic Health Systems and Vapotherm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vapotherm and Tivic Health 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 Tivic Health Systems are associated (or correlated) with Vapotherm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vapotherm has no effect on the direction of Tivic Health i.e., Tivic Health and Vapotherm go up and down completely randomly.

Pair Corralation between Tivic Health and Vapotherm

If you would invest  30.00  in Tivic Health Systems on October 26, 2024 and sell it today you would lose (2.00) from holding Tivic Health Systems or give up 6.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.69%
Values	Daily Returns

Tivic Health Systems  vs.  Vapotherm

Tivic Health Systems

Risk-Adjusted Performance

3 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tivic Health Systems are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Tivic Health exhibited solid returns over the last few months and may actually be approaching a breakup point.

Vapotherm

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vapotherm has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Vapotherm is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Tivic Health and Vapotherm

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

The idea behind Tivic Health Systems and Vapotherm 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.