Correlation Between LianBio ADR and Equillium
Can any of the company-specific risk be diversified away by investing in both LianBio ADR and Equillium 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 LianBio ADR and Equillium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LianBio ADR and Equillium, you can compare the effects of market volatilities on LianBio ADR and Equillium 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 LianBio ADR with a short position of Equillium. Check out your portfolio center. Please also check ongoing floating volatility patterns of LianBio ADR and Equillium.
Diversification Opportunities for LianBio ADR and Equillium
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between LianBio and Equillium is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding LianBio ADR and Equillium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equillium and LianBio ADR 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 LianBio ADR are associated (or correlated) with Equillium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equillium has no effect on the direction of LianBio ADR i.e., LianBio ADR and Equillium go up and down completely randomly.
Pair Corralation between LianBio ADR and Equillium
If you would invest 218.00 in LianBio ADR on September 2, 2024 and sell it today you would earn a total of 0.00 from holding LianBio ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
LianBio ADR vs. Equillium
Performance |
| Timeline |
| LianBio ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Equillium |
LianBio ADR and Equillium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LianBio ADR and Equillium
The main advantage of trading using opposite LianBio ADR and Equillium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LianBio ADR position performs unexpectedly, Equillium 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 Equillium will offset losses from the drop in Equillium's long position.| LianBio ADR vs. Sensei Biotherapeutics | LianBio ADR vs. NextCure | LianBio ADR vs. Nuvation Bio | LianBio ADR vs. Inozyme Pharma |
| Equillium vs. Tff Pharmaceuticals | Equillium vs. Eliem Therapeutics | Equillium vs. Inhibrx | Equillium vs. Enliven Therapeutics |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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