Correlation Between Sellas Life and Oncolytics Biotech

Can any of the company-specific risk be diversified away by investing in both Sellas Life and Oncolytics Biotech 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 Oncolytics Biotech 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 Oncolytics Biotech, you can compare the effects of market volatilities on Sellas Life and Oncolytics Biotech 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 Oncolytics Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sellas Life and Oncolytics Biotech.

Diversification Opportunities for Sellas Life and Oncolytics Biotech

-0.39

Correlation Coefficient

Sellas Life  Oncolytics Biotech

Very good diversification

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

Pair Corralation between Sellas Life and Oncolytics Biotech

Considering the 90-day investment horizon Sellas Life is expected to generate 4.03 times less return on investment than Oncolytics Biotech. But when comparing it to its historical volatility, Sellas Life Sciences is 1.79 times less risky than Oncolytics Biotech. It trades about 0.03 of its potential returns per unit of risk. Oncolytics Biotech is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  91.00  in Oncolytics Biotech on August 13, 2024 and sell it today you would earn a total of  16.00  from holding Oncolytics Biotech or generate 17.58% return on investment over 90 days.

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

Sellas Life Sciences  vs.  Oncolytics Biotech

Sellas Life Sciences

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sellas Life Sciences are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable essential indicators, Sellas Life is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Oncolytics Biotech

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Oncolytics Biotech are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental indicators, Oncolytics Biotech showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Sellas Life and Oncolytics Biotech

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

The idea behind Sellas Life Sciences and Oncolytics Biotech 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.