Correlation Between Alector and Seagen

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

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

Diversification Opportunities for Alector and Seagen

0.0

Correlation Coefficient

Alector  Seagen

Pay attention - limited upside

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

Pair Corralation between Alector and Seagen

If you would invest (100.00) in Seagen Inc on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Seagen Inc or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Alector  vs.  Seagen Inc

Alector

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alector has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Seagen Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Seagen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Seagen is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Alector and Seagen

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

The idea behind Alector and Seagen Inc 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.