Correlation Between ELYM Old and SAB Biotherapeutics

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

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

Diversification Opportunities for ELYM Old and SAB Biotherapeutics

0.0

Correlation Coefficient

ELYM Old  SAB Biotherapeutics

Pay attention - limited upside

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

Pair Corralation between ELYM Old and SAB Biotherapeutics

If you would invest  8.00  in SAB Biotherapeutics on December 27, 2024 and sell it today you would lose (5.01) from holding SAB Biotherapeutics or give up 62.62% of portfolio value over 90 days.

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

ELYM Old  vs.  SAB Biotherapeutics

ELYM Old

Risk-Adjusted Performance

Very Weak

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

SAB Biotherapeutics

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SAB Biotherapeutics are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, SAB Biotherapeutics showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ELYM Old and SAB Biotherapeutics

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

The idea behind ELYM Old and SAB 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.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.