Correlation Between Celestica and Estrella Immunopharma

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

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

Diversification Opportunities for Celestica and Estrella Immunopharma

0.55

Correlation Coefficient

Celestica  Estrella Immunopharma

Very weak diversification

The 3 months correlation between Celestica and Estrella is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Celestica and Estrella Immunopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Estrella Immunopharma and Celestica 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 Celestica are associated (or correlated) with Estrella Immunopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Estrella Immunopharma has no effect on the direction of Celestica i.e., Celestica and Estrella Immunopharma go up and down completely randomly.

Pair Corralation between Celestica and Estrella Immunopharma

Considering the 90-day investment horizon Celestica is expected to generate 0.98 times more return on investment than Estrella Immunopharma. However, Celestica is 1.02 times less risky than Estrella Immunopharma. It trades about 0.03 of its potential returns per unit of risk. Estrella Immunopharma is currently generating about 0.0 per unit of risk. If you would invest  9,752  in Celestica on December 22, 2024 and sell it today you would lose (157.00) from holding Celestica or give up 1.61% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Celestica  vs.  Estrella Immunopharma

Celestica

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Celestica are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain essential indicators, Celestica may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Estrella Immunopharma

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Celestica and Estrella Immunopharma

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

The idea behind Celestica and Estrella Immunopharma 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.