Correlation Between CERo Therapeutics and Vivic Corp

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

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

Diversification Opportunities for CERo Therapeutics and Vivic Corp

-0.6

Correlation Coefficient

CERo Therapeutics  Vivic Corp

Excellent diversification

The 3 months correlation between CERo and Vivic is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding CERo Therapeutics Holdings and Vivic Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vivic Corp and CERo 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 CERo Therapeutics Holdings are associated (or correlated) with Vivic Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vivic Corp has no effect on the direction of CERo Therapeutics i.e., CERo Therapeutics and Vivic Corp go up and down completely randomly.

Pair Corralation between CERo Therapeutics and Vivic Corp

Assuming the 90 days horizon CERo Therapeutics Holdings is expected to under-perform the Vivic Corp. In addition to that, CERo Therapeutics is 1.91 times more volatile than Vivic Corp. It trades about -0.03 of its total potential returns per unit of risk. Vivic Corp is currently generating about 0.35 per unit of volatility. If you would invest  179.00  in Vivic Corp on September 28, 2024 and sell it today you would earn a total of  221.00  from holding Vivic Corp or generate 123.46% return on investment over 90 days.

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

CERo Therapeutics Holdings  vs.  Vivic Corp

CERo Therapeutics

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CERo Therapeutics Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly conflicting basic indicators, CERo Therapeutics showed solid returns over the last few months and may actually be approaching a breakup point.

Vivic Corp

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vivic Corp are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Vivic Corp exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CERo Therapeutics and Vivic Corp

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

The idea behind CERo Therapeutics Holdings and Vivic Corp 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.