Correlation Between Vivani Medical and Cingulate

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

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

Diversification Opportunities for Vivani Medical and Cingulate

0.86

Correlation Coefficient

Vivani Medical  Cingulate

Very poor diversification

The 3 months correlation between Vivani and Cingulate is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Vivani Medical and Cingulate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cingulate 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 Cingulate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cingulate has no effect on the direction of Vivani Medical i.e., Vivani Medical and Cingulate go up and down completely randomly.

Pair Corralation between Vivani Medical and Cingulate

Given the investment horizon of 90 days Vivani Medical is expected to generate 0.51 times more return on investment than Cingulate. However, Vivani Medical is 1.98 times less risky than Cingulate. It trades about -0.06 of its potential returns per unit of risk. Cingulate is currently generating about -0.07 per unit of risk. If you would invest  118.00  in Vivani Medical on December 22, 2024 and sell it today you would lose (9.00) from holding Vivani Medical or give up 7.63% of portfolio value over 90 days.

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

Vivani Medical  vs.  Cingulate

Vivani Medical

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vivani Medical has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Cingulate

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cingulate 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 nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Vivani Medical and Cingulate

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

The idea behind Vivani Medical and Cingulate 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.