Correlation Between Celltrion and Rainbow Robotics

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

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

Diversification Opportunities for Celltrion and Rainbow Robotics

0.0

Correlation Coefficient

Celltrion  Rainbow Robotics

Pay attention - limited upside

The 3 months correlation between Celltrion and Rainbow is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Celltrion and Rainbow Robotics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rainbow Robotics and Celltrion 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 Celltrion are associated (or correlated) with Rainbow Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rainbow Robotics has no effect on the direction of Celltrion i.e., Celltrion and Rainbow Robotics go up and down completely randomly.

Pair Corralation between Celltrion and Rainbow Robotics

If you would invest  17,356,900  in Celltrion on October 5, 2024 and sell it today you would earn a total of  733,100  from holding Celltrion or generate 4.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Celltrion  vs.  Rainbow Robotics

Celltrion

Risk-Adjusted Performance

0 of 100

Very Weak

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

Rainbow Robotics

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Rainbow Robotics has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Rainbow Robotics is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Celltrion and Rainbow Robotics

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

The idea behind Celltrion and Rainbow Robotics 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.

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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.