Correlation Between Lineage Cell and Olema Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Lineage Cell and Olema 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 Lineage Cell and Olema Pharmaceuticals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lineage Cell Therapeutics and Olema Pharmaceuticals, you can compare the effects of market volatilities on Lineage Cell and Olema 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 Lineage Cell with a short position of Olema Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lineage Cell and Olema Pharmaceuticals.
Diversification Opportunities for Lineage Cell and Olema Pharmaceuticals
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lineage and Olema is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Lineage Cell Therapeutics and Olema Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olema Pharmaceuticals and Lineage Cell 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 Lineage Cell Therapeutics are associated (or correlated) with Olema Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olema Pharmaceuticals has no effect on the direction of Lineage Cell i.e., Lineage Cell and Olema Pharmaceuticals go up and down completely randomly.
Pair Corralation between Lineage Cell and Olema Pharmaceuticals
Given the investment horizon of 90 days Lineage Cell Therapeutics is expected to generate 1.22 times more return on investment than Olema Pharmaceuticals. However, Lineage Cell is 1.22 times more volatile than Olema Pharmaceuticals. It trades about -0.03 of its potential returns per unit of risk. Olema Pharmaceuticals is currently generating about -0.16 per unit of risk. If you would invest 84.00 in Lineage Cell Therapeutics on October 25, 2024 and sell it today you would lose (21.00) from holding Lineage Cell Therapeutics or give up 25.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lineage Cell Therapeutics vs. Olema Pharmaceuticals
Performance |
| Timeline |
| Lineage Cell Therapeutics |
| Olema Pharmaceuticals |
Lineage Cell and Olema Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lineage Cell and Olema Pharmaceuticals
The main advantage of trading using opposite Lineage Cell and Olema Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lineage Cell position performs unexpectedly, Olema 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 Olema Pharmaceuticals will offset losses from the drop in Olema Pharmaceuticals' long position.| Lineage Cell vs. MAIA Biotechnology | Lineage Cell vs. Armata Pharmaceuticals | Lineage Cell vs. Portage Biotech | Lineage Cell vs. Cadrenal Therapeutics, Common |
| Olema Pharmaceuticals vs. Sana Biotechnology | Olema Pharmaceuticals vs. Cullinan Oncology LLC | Olema Pharmaceuticals vs. Zentalis Pharmaceuticals Llc | Olema Pharmaceuticals vs. Molecular Partners AG |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |