Correlation Between Scisparc and Eledon Pharmaceuticals

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

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

Diversification Opportunities for Scisparc and Eledon Pharmaceuticals

0.54

Correlation Coefficient

Scisparc  Eledon Pharmaceuticals

Very weak diversification

The 3 months correlation between Scisparc and Eledon is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Scisparc and Eledon Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eledon Pharmaceuticals and Scisparc 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 Scisparc are associated (or correlated) with Eledon Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eledon Pharmaceuticals has no effect on the direction of Scisparc i.e., Scisparc and Eledon Pharmaceuticals go up and down completely randomly.

Pair Corralation between Scisparc and Eledon Pharmaceuticals

Given the investment horizon of 90 days Scisparc is expected to under-perform the Eledon Pharmaceuticals. In addition to that, Scisparc is 1.28 times more volatile than Eledon Pharmaceuticals. It trades about -0.1 of its total potential returns per unit of risk. Eledon Pharmaceuticals is currently generating about 0.03 per unit of volatility. If you would invest  310.00  in Eledon Pharmaceuticals on May 3, 2025 and sell it today you would earn a total of  5.00  from holding Eledon Pharmaceuticals or generate 1.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

Scisparc  vs.  Eledon Pharmaceuticals

Scisparc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Scisparc 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 rather sound which may send shares a bit higher in September 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Eledon Pharmaceuticals

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Eledon Pharmaceuticals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very weak fundamental indicators, Eledon Pharmaceuticals may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Scisparc and Eledon Pharmaceuticals

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

The idea behind Scisparc and Eledon 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.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.