Correlation Between Kezar Life and CEL SCI
Can any of the company-specific risk be diversified away by investing in both Kezar Life and CEL SCI 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 Kezar Life and CEL SCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kezar Life Sciences and CEL SCI Corp, you can compare the effects of market volatilities on Kezar Life and CEL SCI 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 Kezar Life with a short position of CEL SCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kezar Life and CEL SCI.
Diversification Opportunities for Kezar Life and CEL SCI
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kezar and CEL is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Kezar Life Sciences and CEL SCI Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CEL SCI Corp and Kezar Life 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 Kezar Life Sciences are associated (or correlated) with CEL SCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CEL SCI Corp has no effect on the direction of Kezar Life i.e., Kezar Life and CEL SCI go up and down completely randomly.
Pair Corralation between Kezar Life and CEL SCI
Considering the 90-day investment horizon Kezar Life Sciences is expected to generate 1.52 times more return on investment than CEL SCI. However, Kezar Life is 1.52 times more volatile than CEL SCI Corp. It trades about 0.05 of its potential returns per unit of risk. CEL SCI Corp is currently generating about -0.21 per unit of risk. If you would invest 680.00 in Kezar Life Sciences on August 26, 2024 and sell it today you would earn a total of 70.00 from holding Kezar Life Sciences or generate 10.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kezar Life Sciences vs. CEL SCI Corp
Performance |
| Timeline |
| Kezar Life Sciences |
| CEL SCI Corp |
Kezar Life and CEL SCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kezar Life and CEL SCI
The main advantage of trading using opposite Kezar Life and CEL SCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kezar Life position performs unexpectedly, CEL SCI 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 CEL SCI will offset losses from the drop in CEL SCI's long position.| Kezar Life vs. Eliem Therapeutics | Kezar Life vs. HCW Biologics | Kezar Life vs. Scpharmaceuticals | Kezar Life vs. Milestone Pharmaceuticals |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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