Correlation Between Eltek and CASI Pharmaceuticals

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

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

Diversification Opportunities for Eltek and CASI Pharmaceuticals

-0.47

Correlation Coefficient

Eltek  CASI Pharmaceuticals

Very good diversification

The 3 months correlation between Eltek and CASI is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Eltek and CASI Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CASI Pharmaceuticals and Eltek 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 Eltek are associated (or correlated) with CASI Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CASI Pharmaceuticals has no effect on the direction of Eltek i.e., Eltek and CASI Pharmaceuticals go up and down completely randomly.

Pair Corralation between Eltek and CASI Pharmaceuticals

Given the investment horizon of 90 days Eltek is expected to under-perform the CASI Pharmaceuticals. But the stock apears to be less risky and, when comparing its historical volatility, Eltek is 5.4 times less risky than CASI Pharmaceuticals. The stock trades about -0.01 of its potential returns per unit of risk. The CASI Pharmaceuticals is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  188.00  in CASI Pharmaceuticals on May 28, 2025 and sell it today you would earn a total of  55.00  from holding CASI Pharmaceuticals or generate 29.26% return on investment over 90 days.

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

Eltek  vs.  CASI Pharmaceuticals

Eltek

Risk-Adjusted Performance

Weakest

Over the last 90 days Eltek has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Eltek is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

CASI Pharmaceuticals

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in CASI Pharmaceuticals are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, CASI Pharmaceuticals demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eltek and CASI Pharmaceuticals

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

The idea behind Eltek and CASI Pharmaceuticals 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.

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 the Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.