Correlation Between CEL SCI and Sitka Gold

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

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

Diversification Opportunities for CEL SCI and Sitka Gold

0.39

Correlation Coefficient

CEL SCI  Sitka Gold

Weak diversification

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

Pair Corralation between CEL SCI and Sitka Gold

Considering the 90-day investment horizon CEL SCI Corp is expected to under-perform the Sitka Gold. In addition to that, CEL SCI is 1.15 times more volatile than Sitka Gold Corp. It trades about -0.08 of its total potential returns per unit of risk. Sitka Gold Corp is currently generating about 0.0 per unit of volatility. If you would invest  27.00  in Sitka Gold Corp on September 29, 2024 and sell it today you would lose (3.00) from holding Sitka Gold Corp or give up 11.11% of portfolio value over 90 days.

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

CEL SCI Corp  vs.  Sitka Gold Corp

CEL SCI Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CEL SCI Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Sitka Gold Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Sitka Gold Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward-looking signals, Sitka Gold is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with CEL SCI and Sitka Gold

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

The idea behind CEL SCI Corp and Sitka Gold 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.