Correlation Between Annexon and Celo

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Can any of the company-specific risk be diversified away by investing in both Annexon and Celo 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 Annexon and Celo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Annexon and Celo, you can compare the effects of market volatilities on Annexon and Celo 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 Annexon with a short position of Celo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Annexon and Celo.

Diversification Opportunities for Annexon and Celo

0.2
  Correlation Coefficient

Modest diversification

The 3 months correlation between Annexon and Celo is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Annexon and Celo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celo and Annexon 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 Annexon are associated (or correlated) with Celo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celo has no effect on the direction of Annexon i.e., Annexon and Celo go up and down completely randomly.

Pair Corralation between Annexon and Celo

Given the investment horizon of 90 days Annexon is expected to generate 0.83 times more return on investment than Celo. However, Annexon is 1.21 times less risky than Celo. It trades about -0.03 of its potential returns per unit of risk. Celo is currently generating about -0.11 per unit of risk. If you would invest  2,498  in Annexon on August 30, 2022 and sell it today you would lose (1,913)  from holding Annexon or give up 76.58% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy57.95%
ValuesDaily Returns

Annexon  vs.  Celo

 Performance (%) 
       Timeline  
Annexon 
Annexon Performance
4 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Annexon are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Annexon may actually be approaching a critical reversion point that can send shares even higher in December 2022.

Annexon Price Channel

Celo 
Celo Performance
0 of 100
Over the last 90 days Celo has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Crypto's essential indicators remain somewhat strong which may send shares a bit higher in December 2022. The current disturbance may also be a sign of long term up-swing for Celo investors.

Celo Price Channel

Annexon and Celo Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Annexon and Celo

The main advantage of trading using opposite Annexon and Celo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Annexon position performs unexpectedly, Celo 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 Celo will offset losses from the drop in Celo's long position.
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The idea behind Annexon and Celo 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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Check out your portfolio center. 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 Analyst Recommendations module to analyst recommendations and target price estimates broken down by several categories.

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