Correlation Between Cardio Diagnostics and SpringWorks Therapeutics

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

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

Diversification Opportunities for Cardio Diagnostics and SpringWorks Therapeutics

0.46

Correlation Coefficient

Cardio Diagnostics  SpringWorks Therapeutics

Very weak diversification

The 3 months correlation between Cardio and SpringWorks is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Cardio Diagnostics Holdings and SpringWorks Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SpringWorks Therapeutics and Cardio Diagnostics 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 Cardio Diagnostics Holdings are associated (or correlated) with SpringWorks Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SpringWorks Therapeutics has no effect on the direction of Cardio Diagnostics i.e., Cardio Diagnostics and SpringWorks Therapeutics go up and down completely randomly.

Pair Corralation between Cardio Diagnostics and SpringWorks Therapeutics

Assuming the 90 days horizon Cardio Diagnostics Holdings is expected to under-perform the SpringWorks Therapeutics. In addition to that, Cardio Diagnostics is 49.62 times more volatile than SpringWorks Therapeutics. It trades about -0.14 of its total potential returns per unit of risk. SpringWorks Therapeutics is currently generating about 0.22 per unit of volatility. If you would invest  4,624  in SpringWorks Therapeutics on April 29, 2025 and sell it today you would earn a total of  75.00  from holding SpringWorks Therapeutics or generate 1.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	80.0%
Values	Daily Returns

Cardio Diagnostics Holdings  vs.  SpringWorks Therapeutics

Cardio Diagnostics

Risk-Adjusted Performance

Very Weak

Over the last 90 days Cardio Diagnostics Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in August 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

SpringWorks Therapeutics

Risk-Adjusted Performance

Solid

Over the last 90 days SpringWorks Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, SpringWorks Therapeutics is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Cardio Diagnostics and SpringWorks Therapeutics

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

The idea behind Cardio Diagnostics Holdings and SpringWorks 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.