Correlation Between Celcuity LLC and Protalix Biotherapeutics

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

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

Diversification Opportunities for Celcuity LLC and Protalix Biotherapeutics

-0.35

Correlation Coefficient

Celcuity LLC  Protalix Biotherapeutics

Very good diversification

The 3 months correlation between Celcuity and Protalix is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Celcuity LLC and Protalix Biotherapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protalix Biotherapeutics and Celcuity LLC 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 Celcuity LLC are associated (or correlated) with Protalix Biotherapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protalix Biotherapeutics has no effect on the direction of Celcuity LLC i.e., Celcuity LLC and Protalix Biotherapeutics go up and down completely randomly.

Pair Corralation between Celcuity LLC and Protalix Biotherapeutics

Given the investment horizon of 90 days Celcuity LLC is expected to under-perform the Protalix Biotherapeutics. In addition to that, Celcuity LLC is 1.51 times more volatile than Protalix Biotherapeutics. It trades about -0.23 of its total potential returns per unit of risk. Protalix Biotherapeutics is currently generating about -0.05 per unit of volatility. If you would invest  243.00  in Protalix Biotherapeutics on December 2, 2024 and sell it today you would lose (10.00) from holding Protalix Biotherapeutics or give up 4.12% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Celcuity LLC  vs.  Protalix Biotherapeutics

Celcuity LLC

Risk-Adjusted Performance

Very Weak

Over the last 90 days Celcuity LLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of conflicting performance in the last few months, the Stock's essential 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.

Protalix Biotherapeutics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Protalix Biotherapeutics are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain essential indicators, Protalix Biotherapeutics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celcuity LLC and Protalix Biotherapeutics

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

The idea behind Celcuity LLC and Protalix Biotherapeutics 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.