Correlation Between Vivani Medical and Altimmune

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

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

Diversification Opportunities for Vivani Medical and Altimmune

0.68

Correlation Coefficient

Vivani Medical  Altimmune

Poor diversification

The 3 months correlation between Vivani and Altimmune is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Vivani Medical and Altimmune in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altimmune and Vivani Medical 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 Vivani Medical are associated (or correlated) with Altimmune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altimmune has no effect on the direction of Vivani Medical i.e., Vivani Medical and Altimmune go up and down completely randomly.

Pair Corralation between Vivani Medical and Altimmune

Given the investment horizon of 90 days Vivani Medical is expected to under-perform the Altimmune. But the stock apears to be less risky and, when comparing its historical volatility, Vivani Medical is 1.67 times less risky than Altimmune. The stock trades about -0.2 of its potential returns per unit of risk. The Altimmune is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  868.00  in Altimmune on September 23, 2024 and sell it today you would lose (43.00) from holding Altimmune or give up 4.95% of portfolio value over 90 days.

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

Vivani Medical  vs.  Altimmune

Vivani Medical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vivani Medical has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Vivani Medical is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Altimmune

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Altimmune are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent essential indicators, Altimmune unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vivani Medical and Altimmune

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

The idea behind Vivani Medical and Altimmune 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.