Correlation Between Sellas Life and Asbury Automotive
Can any of the company-specific risk be diversified away by investing in both Sellas Life and Asbury Automotive 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 Sellas Life and Asbury Automotive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sellas Life Sciences and Asbury Automotive Group, you can compare the effects of market volatilities on Sellas Life and Asbury Automotive 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 Sellas Life with a short position of Asbury Automotive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sellas Life and Asbury Automotive.
Diversification Opportunities for Sellas Life and Asbury Automotive
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sellas and Asbury is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Sellas Life Sciences and Asbury Automotive Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asbury Automotive and Sellas 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 Sellas Life Sciences are associated (or correlated) with Asbury Automotive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asbury Automotive has no effect on the direction of Sellas Life i.e., Sellas Life and Asbury Automotive go up and down completely randomly.
Pair Corralation between Sellas Life and Asbury Automotive
Considering the 90-day investment horizon Sellas Life Sciences is expected to generate 2.53 times more return on investment than Asbury Automotive. However, Sellas Life is 2.53 times more volatile than Asbury Automotive Group. It trades about 0.02 of its potential returns per unit of risk. Asbury Automotive Group is currently generating about 0.04 per unit of risk. If you would invest 142.00 in Sellas Life Sciences on September 4, 2024 and sell it today you would lose (26.00) from holding Sellas Life Sciences or give up 18.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sellas Life Sciences vs. Asbury Automotive Group
Performance |
| Timeline |
| Sellas Life Sciences |
| Asbury Automotive |
Sellas Life and Asbury Automotive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sellas Life and Asbury Automotive
The main advantage of trading using opposite Sellas Life and Asbury Automotive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sellas Life position performs unexpectedly, Asbury Automotive 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 Asbury Automotive will offset losses from the drop in Asbury Automotive's long position.| Sellas Life vs. Candel Therapeutics | Sellas Life vs. Cingulate Warrants | Sellas Life vs. Unicycive Therapeutics | Sellas Life vs. Cardio Diagnostics Holdings |
| Asbury Automotive vs. Sonic Automotive | Asbury Automotive vs. Lithia Motors | Asbury Automotive vs. AutoNation | Asbury Automotive vs. Penske Automotive Group |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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