Correlation Between Sellas Life and Proficient Auto

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

By analyzing existing cross correlation between Sellas Life Sciences and Proficient Auto Logistics,, you can compare the effects of market volatilities on Sellas Life and Proficient Auto 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 Sellas Life with a short position of Proficient Auto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sellas Life and Proficient Auto.

Diversification Opportunities for Sellas Life and Proficient Auto

0.39

Correlation Coefficient

Sellas Life  Proficient Auto

Weak diversification

The 3 months correlation between Sellas and Proficient is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Sellas Life Sciences and Proficient Auto Logistics, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Proficient Auto Logi and Sellas Life 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 Sellas Life Sciences are associated (or correlated) with Proficient Auto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Proficient Auto Logi has no effect on the direction of Sellas Life i.e., Sellas Life and Proficient Auto go up and down completely randomly.

Pair Corralation between Sellas Life and Proficient Auto

Considering the 90-day investment horizon Sellas Life Sciences is expected to generate 0.67 times more return on investment than Proficient Auto. However, Sellas Life Sciences is 1.49 times less risky than Proficient Auto. It trades about -0.01 of its potential returns per unit of risk. Proficient Auto Logistics, is currently generating about -0.18 per unit of risk. If you would invest  123.00  in Sellas Life Sciences on September 4, 2024 and sell it today you would lose (7.00) from holding Sellas Life Sciences or give up 5.69% of portfolio value over 90 days.

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

Sellas Life Sciences  vs.  Proficient Auto Logistics,

Sellas Life Sciences

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sellas Life Sciences has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable essential indicators, Sellas Life is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Proficient Auto Logi

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Sellas Life and Proficient Auto

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

The idea behind Sellas Life Sciences and Proficient Auto Logistics, 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.