Correlation Between Vivos Therapeutics and LivaNova PLC

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

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

Diversification Opportunities for Vivos Therapeutics and LivaNova PLC

-0.78

Correlation Coefficient

Vivos Therapeutics  LivaNova PLC

Pay attention - limited upside

The 3 months correlation between Vivos and LivaNova is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Vivos Therapeutics and LivaNova PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LivaNova PLC and Vivos Therapeutics 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 Vivos Therapeutics are associated (or correlated) with LivaNova PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LivaNova PLC has no effect on the direction of Vivos Therapeutics i.e., Vivos Therapeutics and LivaNova PLC go up and down completely randomly.

Pair Corralation between Vivos Therapeutics and LivaNova PLC

Given the investment horizon of 90 days Vivos Therapeutics is expected to generate 16.82 times more return on investment than LivaNova PLC. However, Vivos Therapeutics is 16.82 times more volatile than LivaNova PLC. It trades about 0.03 of its potential returns per unit of risk. LivaNova PLC is currently generating about 0.0 per unit of risk. If you would invest  3,050  in Vivos Therapeutics on October 21, 2024 and sell it today you would lose (2,476) from holding Vivos Therapeutics or give up 81.18% of portfolio value over 90 days.

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

Vivos Therapeutics  vs.  LivaNova PLC

Vivos Therapeutics

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Vivos Therapeutics are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Vivos Therapeutics unveiled solid returns over the last few months and may actually be approaching a breakup point.

LivaNova PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LivaNova PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain 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 Vivos Therapeutics and LivaNova PLC

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

The idea behind Vivos Therapeutics and LivaNova PLC 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.