Correlation Between Vivani Medical and BioRestorative Therapies

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

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

Diversification Opportunities for Vivani Medical and BioRestorative Therapies

-0.48

Correlation Coefficient

Vivani Medical  BioRestorative Therapies

Very good diversification

The 3 months correlation between Vivani and BioRestorative is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Vivani Medical and BioRestorative Therapies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BioRestorative Therapies 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 BioRestorative Therapies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BioRestorative Therapies has no effect on the direction of Vivani Medical i.e., Vivani Medical and BioRestorative Therapies go up and down completely randomly.

Pair Corralation between Vivani Medical and BioRestorative Therapies

Given the investment horizon of 90 days Vivani Medical is expected to generate 0.74 times more return on investment than BioRestorative Therapies. However, Vivani Medical is 1.35 times less risky than BioRestorative Therapies. It trades about 0.11 of its potential returns per unit of risk. BioRestorative Therapies is currently generating about 0.0 per unit of risk. If you would invest  121.00  in Vivani Medical on September 4, 2024 and sell it today you would earn a total of  24.00  from holding Vivani Medical or generate 19.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Vivani Medical  vs.  BioRestorative Therapies

Vivani Medical

Risk-Adjusted Performance

8 of 100

OK

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

BioRestorative Therapies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BioRestorative Therapies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, BioRestorative Therapies is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vivani Medical and BioRestorative Therapies

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

The idea behind Vivani Medical and BioRestorative Therapies 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.