Correlation Between Celcuity LLC and Scholar Rock

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

By analyzing existing cross correlation between Celcuity LLC and Scholar Rock Holding, you can compare the effects of market volatilities on Celcuity LLC and Scholar Rock 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 Scholar Rock. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celcuity LLC and Scholar Rock.

Diversification Opportunities for Celcuity LLC and Scholar Rock

0.38

Correlation Coefficient

Celcuity LLC  Scholar Rock

Weak diversification

The 3 months correlation between Celcuity and Scholar is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Celcuity LLC and Scholar Rock Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scholar Rock Holding 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 Scholar Rock. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scholar Rock Holding has no effect on the direction of Celcuity LLC i.e., Celcuity LLC and Scholar Rock go up and down completely randomly.

Pair Corralation between Celcuity LLC and Scholar Rock

Given the investment horizon of 90 days Celcuity LLC is expected to generate 1.4 times more return on investment than Scholar Rock. However, Celcuity LLC is 1.4 times more volatile than Scholar Rock Holding. It trades about -0.06 of its potential returns per unit of risk. Scholar Rock Holding is currently generating about -0.13 per unit of risk. If you would invest  1,313  in Celcuity LLC on December 29, 2024 and sell it today you would lose (259.00) from holding Celcuity LLC or give up 19.73% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Celcuity LLC  vs.  Scholar Rock Holding

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.

Scholar Rock Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Scholar Rock Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Celcuity LLC and Scholar Rock

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

The idea behind Celcuity LLC and Scholar Rock Holding 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.