Correlation Between CVC Brasil and Sarepta Therapeutics

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

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

Diversification Opportunities for CVC Brasil and Sarepta Therapeutics

-0.37

Correlation Coefficient

CVC Brasil  Sarepta Therapeutics

Very good diversification

The 3 months correlation between CVC and Sarepta is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding CVC Brasil Operadora and Sarepta Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sarepta Therapeutics and CVC Brasil 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 CVC Brasil Operadora are associated (or correlated) with Sarepta Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sarepta Therapeutics has no effect on the direction of CVC Brasil i.e., CVC Brasil and Sarepta Therapeutics go up and down completely randomly.

Pair Corralation between CVC Brasil and Sarepta Therapeutics

Assuming the 90 days trading horizon CVC Brasil Operadora is expected to generate 0.4 times more return on investment than Sarepta Therapeutics. However, CVC Brasil Operadora is 2.48 times less risky than Sarepta Therapeutics. It trades about 0.05 of its potential returns per unit of risk. Sarepta Therapeutics is currently generating about -0.19 per unit of risk. If you would invest  220.00  in CVC Brasil Operadora on April 22, 2025 and sell it today you would earn a total of  19.00  from holding CVC Brasil Operadora or generate 8.64% return on investment over 90 days.

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

CVC Brasil Operadora  vs.  Sarepta Therapeutics

CVC Brasil Operadora

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CVC Brasil Operadora are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CVC Brasil may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Sarepta Therapeutics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sarepta Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with CVC Brasil and Sarepta Therapeutics

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

The idea behind CVC Brasil Operadora and Sarepta Therapeutics 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.