Correlation Between Vivani Medical and Lantern Pharma

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

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

Diversification Opportunities for Vivani Medical and Lantern Pharma

-0.48

Correlation Coefficient

Vivani Medical  Lantern Pharma

Very good diversification

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

Pair Corralation between Vivani Medical and Lantern Pharma

Given the investment horizon of 90 days Vivani Medical is expected to generate 2.81 times more return on investment than Lantern Pharma. However, Vivani Medical is 2.81 times more volatile than Lantern Pharma. It trades about 0.05 of its potential returns per unit of risk. Lantern Pharma is currently generating about 0.02 per unit of risk. If you would invest  88.00  in Vivani Medical on September 4, 2024 and sell it today you would earn a total of  53.00  from holding Vivani Medical or generate 60.23% return on investment over 90 days.

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

Vivani Medical  vs.  Lantern Pharma

Vivani Medical

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vivani Medical are ranked lower than 7 (%) 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.

Lantern Pharma

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lantern Pharma has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Vivani Medical and Lantern Pharma

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

The idea behind Vivani Medical and Lantern Pharma 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.