Correlation Between Sellas Life and I Mab
Can any of the company-specific risk be diversified away by investing in both Sellas Life and I Mab 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 I Mab 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 I Mab, you can compare the effects of market volatilities on Sellas Life and I Mab 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 I Mab. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sellas Life and I Mab.
Diversification Opportunities for Sellas Life and I Mab
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sellas and IMAB is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sellas Life Sciences and I Mab in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on I Mab 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 I Mab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of I Mab has no effect on the direction of Sellas Life i.e., Sellas Life and I Mab go up and down completely randomly.
Pair Corralation between Sellas Life and I Mab
Considering the 90-day investment horizon Sellas Life is expected to generate 4.26 times less return on investment than I Mab. But when comparing it to its historical volatility, Sellas Life Sciences is 1.1 times less risky than I Mab. It trades about 0.06 of its potential returns per unit of risk. I Mab is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 88.00 in I Mab on October 28, 2024 and sell it today you would earn a total of 20.00 from holding I Mab or generate 22.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sellas Life Sciences vs. I Mab
Performance |
| Timeline |
| Sellas Life Sciences |
| I Mab |
Sellas Life and I Mab Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sellas Life and I Mab
The main advantage of trading using opposite Sellas Life and I Mab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sellas Life position performs unexpectedly, I Mab 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 I Mab will offset losses from the drop in I Mab's long position.| 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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