Correlation Between Fennec Pharmaceuticals and Celcuity LLC

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

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

Diversification Opportunities for Fennec Pharmaceuticals and Celcuity LLC

-0.7

Correlation Coefficient

Fennec Pharmaceuticals  Celcuity LLC

Excellent diversification

The 3 months correlation between Fennec and Celcuity is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Fennec Pharmaceuticals and Celcuity LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celcuity LLC and Fennec Pharmaceuticals 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 Fennec Pharmaceuticals are associated (or correlated) with Celcuity LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celcuity LLC has no effect on the direction of Fennec Pharmaceuticals i.e., Fennec Pharmaceuticals and Celcuity LLC go up and down completely randomly.

Pair Corralation between Fennec Pharmaceuticals and Celcuity LLC

Given the investment horizon of 90 days Fennec Pharmaceuticals is expected to generate 1.46 times more return on investment than Celcuity LLC. However, Fennec Pharmaceuticals is 1.46 times more volatile than Celcuity LLC. It trades about 0.14 of its potential returns per unit of risk. Celcuity LLC is currently generating about -0.08 per unit of risk. If you would invest  442.00  in Fennec Pharmaceuticals on October 11, 2024 and sell it today you would earn a total of  166.00  from holding Fennec Pharmaceuticals or generate 37.56% return on investment over 90 days.

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

Fennec Pharmaceuticals  vs.  Celcuity LLC

Fennec Pharmaceuticals

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fennec Pharmaceuticals are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Fennec Pharmaceuticals exhibited solid returns over the last few months and may actually be approaching a breakup point.

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.

Pair Trading with Fennec Pharmaceuticals and Celcuity LLC

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

The idea behind Fennec Pharmaceuticals and Celcuity LLC 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.