Correlation Between Caribou Biosciences and Lyra Therapeutics
Can any of the company-specific risk be diversified away by investing in both Caribou Biosciences and Lyra Therapeutics 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 Caribou Biosciences and Lyra Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caribou Biosciences and Lyra Therapeutics, you can compare the effects of market volatilities on Caribou Biosciences and Lyra Therapeutics 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 Caribou Biosciences with a short position of Lyra Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caribou Biosciences and Lyra Therapeutics.
Diversification Opportunities for Caribou Biosciences and Lyra Therapeutics
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Caribou and Lyra is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Caribou Biosciences and Lyra Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lyra Therapeutics and Caribou Biosciences 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 Caribou Biosciences are associated (or correlated) with Lyra Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lyra Therapeutics has no effect on the direction of Caribou Biosciences i.e., Caribou Biosciences and Lyra Therapeutics go up and down completely randomly.
Pair Corralation between Caribou Biosciences and Lyra Therapeutics
Given the investment horizon of 90 days Caribou Biosciences is expected to under-perform the Lyra Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Caribou Biosciences is 1.37 times less risky than Lyra Therapeutics. The stock trades about -0.17 of its potential returns per unit of risk. The Lyra Therapeutics is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 19.00 in Lyra Therapeutics on October 15, 2024 and sell it today you would earn a total of 1.00 from holding Lyra Therapeutics or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caribou Biosciences vs. Lyra Therapeutics
Performance |
| Timeline |
| Caribou Biosciences |
| Lyra Therapeutics |
Caribou Biosciences and Lyra Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caribou Biosciences and Lyra Therapeutics
The main advantage of trading using opposite Caribou Biosciences and Lyra Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caribou Biosciences position performs unexpectedly, Lyra Therapeutics 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 Lyra Therapeutics will offset losses from the drop in Lyra Therapeutics' long position.| Caribou Biosciences vs. Intellia Therapeutics | Caribou Biosciences vs. Editas Medicine | Caribou Biosciences vs. Crispr Therapeutics AG | Caribou Biosciences vs. Verve Therapeutics |
| Lyra Therapeutics vs. CytomX Therapeutics | Lyra Therapeutics vs. Assembly Biosciences | Lyra Therapeutics vs. Achilles Therapeutics PLC | Lyra Therapeutics vs. Instil Bio |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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