Correlation Between Celcuity LLC and Zenith Capital

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

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

Diversification Opportunities for Celcuity LLC and Zenith Capital

0.29

Correlation Coefficient

Celcuity LLC  Zenith Capital

Modest diversification

The 3 months correlation between Celcuity and Zenith is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Celcuity LLC and Zenith Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zenith Capital Corp 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 Zenith Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zenith Capital Corp has no effect on the direction of Celcuity LLC i.e., Celcuity LLC and Zenith Capital go up and down completely randomly.

Pair Corralation between Celcuity LLC and Zenith Capital

Given the investment horizon of 90 days Celcuity LLC is expected to under-perform the Zenith Capital. But the stock apears to be less risky and, when comparing its historical volatility, Celcuity LLC is 50.51 times less risky than Zenith Capital. The stock trades about -0.13 of its potential returns per unit of risk. The Zenith Capital Corp is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  8.00  in Zenith Capital Corp on October 26, 2024 and sell it today you would lose (7.99) from holding Zenith Capital Corp or give up 99.87% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.16%
Values	Daily Returns

Celcuity LLC  vs.  Zenith Capital Corp

Celcuity LLC

Risk-Adjusted Performance

0 of 100

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 February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Zenith Capital Corp

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Zenith Capital Corp are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, Zenith Capital reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Celcuity LLC and Zenith Capital

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

The idea behind Celcuity LLC and Zenith Capital Corp 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.