Correlation Between Burning Rock and LumiraDx
Can any of the company-specific risk be diversified away by investing in both Burning Rock and LumiraDx 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 Burning Rock and LumiraDx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Burning Rock Biotech and LumiraDx, you can compare the effects of market volatilities on Burning Rock and LumiraDx 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 Burning Rock with a short position of LumiraDx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Burning Rock and LumiraDx.
Diversification Opportunities for Burning Rock and LumiraDx
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Burning and LumiraDx is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Burning Rock Biotech and LumiraDx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LumiraDx and Burning Rock 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 Burning Rock Biotech are associated (or correlated) with LumiraDx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LumiraDx has no effect on the direction of Burning Rock i.e., Burning Rock and LumiraDx go up and down completely randomly.
Pair Corralation between Burning Rock and LumiraDx
If you would invest 285.00 in Burning Rock Biotech on August 27, 2024 and sell it today you would earn a total of 275.00 from holding Burning Rock Biotech or generate 96.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Burning Rock Biotech vs. LumiraDx
Performance |
| Timeline |
| Burning Rock Biotech |
| LumiraDx |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Burning Rock and LumiraDx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Burning Rock and LumiraDx
The main advantage of trading using opposite Burning Rock and LumiraDx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Burning Rock position performs unexpectedly, LumiraDx 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 LumiraDx will offset losses from the drop in LumiraDx's long position.| Burning Rock vs. Fonar | Burning Rock vs. Sera Prognostics | Burning Rock vs. Neuronetics | Burning Rock vs. DarioHealth Corp |
| LumiraDx vs. Fonar | LumiraDx vs. Burning Rock Biotech | LumiraDx vs. Sera Prognostics | LumiraDx vs. Exagen Inc |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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