Correlation Between CEL SCI and Sutro Biopharma

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

Diversification Opportunities for CEL SCI and Sutro Biopharma

0.22
  Correlation Coefficient

Modest diversification

The 3 months correlation between CEL and Sutro is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding CEL SCI Corp and Sutro Biopharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sutro Biopharma 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 Sutro Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sutro Biopharma has no effect on the direction of CEL SCI i.e., CEL SCI and Sutro Biopharma go up and down completely randomly.

Pair Corralation between CEL SCI and Sutro Biopharma

Considering the 90-day investment horizon CEL SCI Corp is expected to under-perform the Sutro Biopharma. In addition to that, CEL SCI is 1.21 times more volatile than Sutro Biopharma. It trades about -0.02 of its total potential returns per unit of risk. Sutro Biopharma is currently generating about 0.0 per unit of volatility. If you would invest  88.00  in Sutro Biopharma on August 15, 2025 and sell it today you would lose (7.00) from holding Sutro Biopharma or give up 7.95% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy93.65%
ValuesDaily Returns

CEL SCI Corp  vs.  Sutro Biopharma

 Performance 
       Timeline  
CEL SCI Corp 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
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 latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.
Sutro Biopharma 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Sutro Biopharma has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Sutro Biopharma is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

CEL SCI and Sutro Biopharma Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CEL SCI and Sutro Biopharma

The main advantage of trading using opposite CEL SCI and Sutro Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEL SCI position performs unexpectedly, Sutro Biopharma 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 Sutro Biopharma will offset losses from the drop in Sutro Biopharma's long position.
The idea behind CEL SCI Corp and Sutro Biopharma 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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.

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