Correlation Between Kezar Life and Sellas Life
Can any of the company-specific risk be diversified away by investing in both Kezar Life and Sellas Life 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 Sellas Life 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 Sellas Life Sciences, you can compare the effects of market volatilities on Kezar Life and Sellas Life 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 Sellas Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kezar Life and Sellas Life.
Diversification Opportunities for Kezar Life and Sellas Life
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kezar and Sellas is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Kezar Life Sciences and Sellas Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sellas Life Sciences 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 Sellas Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sellas Life Sciences has no effect on the direction of Kezar Life i.e., Kezar Life and Sellas Life go up and down completely randomly.
Pair Corralation between Kezar Life and Sellas Life
Considering the 90-day investment horizon Kezar Life Sciences is expected to under-perform the Sellas Life. But the stock apears to be less risky and, when comparing its historical volatility, Kezar Life Sciences is 1.37 times less risky than Sellas Life. The stock trades about -0.19 of its potential returns per unit of risk. The Sellas Life Sciences is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 119.00 in Sellas Life Sciences on August 31, 2024 and sell it today you would lose (2.00) from holding Sellas Life Sciences or give up 1.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kezar Life Sciences vs. Sellas Life Sciences
Performance |
| Timeline |
| Kezar Life Sciences |
| Sellas Life Sciences |
Kezar Life and Sellas Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kezar Life and Sellas Life
The main advantage of trading using opposite Kezar Life and Sellas Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kezar Life position performs unexpectedly, Sellas Life 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 Sellas Life will offset losses from the drop in Sellas Life's long position.| Kezar Life vs. Cue Biopharma | Kezar Life vs. Tff Pharmaceuticals | Kezar Life vs. Eliem Therapeutics | Kezar Life vs. Inhibrx |
| Sellas Life vs. NLS Pharmaceutics AG | Sellas Life vs. Mereo BioPharma Group | Sellas Life vs. Day One Biopharmaceuticals | Sellas Life vs. Reviva Pharmaceuticals Holdings |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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