Correlation Between Aethlon Medical and Cerus
Can any of the company-specific risk be diversified away by investing in both Aethlon Medical and Cerus 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 Aethlon Medical and Cerus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aethlon Medical and Cerus, you can compare the effects of market volatilities on Aethlon Medical and Cerus 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 Aethlon Medical with a short position of Cerus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aethlon Medical and Cerus.
Diversification Opportunities for Aethlon Medical and Cerus
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aethlon and Cerus is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Aethlon Medical and Cerus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cerus and Aethlon 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 Aethlon Medical are associated (or correlated) with Cerus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cerus has no effect on the direction of Aethlon Medical i.e., Aethlon Medical and Cerus go up and down completely randomly.
Pair Corralation between Aethlon Medical and Cerus
Given the investment horizon of 90 days Aethlon Medical is expected to under-perform the Cerus. In addition to that, Aethlon Medical is 1.8 times more volatile than Cerus. It trades about -0.01 of its total potential returns per unit of risk. Cerus is currently generating about -0.01 per unit of volatility. If you would invest 225.00 in Cerus on September 20, 2024 and sell it today you would lose (67.00) from holding Cerus or give up 29.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aethlon Medical vs. Cerus
Performance |
| Timeline |
| Aethlon Medical |
| Cerus |
Aethlon Medical and Cerus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aethlon Medical and Cerus
The main advantage of trading using opposite Aethlon Medical and Cerus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aethlon Medical position performs unexpectedly, Cerus 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 Cerus will offset losses from the drop in Cerus' long position.| Aethlon Medical vs. Tivic Health Systems | Aethlon Medical vs. Bluejay Diagnostics | Aethlon Medical vs. Heart Test Laboratories | Aethlon Medical vs. Nuwellis |
Check out your portfolio center.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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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