Correlation Between Eli Lilly and Zura Bio
Can any of the company-specific risk be diversified away by investing in both Eli Lilly and Zura Bio 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 Eli Lilly and Zura Bio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eli Lilly and and Zura Bio Limited, you can compare the effects of market volatilities on Eli Lilly and Zura Bio 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 Eli Lilly with a short position of Zura Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eli Lilly and Zura Bio.
Diversification Opportunities for Eli Lilly and Zura Bio
Very weak diversification
The 3 months correlation between Eli and Zura is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Eli Lilly and and Zura Bio Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zura Bio Limited and Eli Lilly 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 Eli Lilly and are associated (or correlated) with Zura Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zura Bio Limited has no effect on the direction of Eli Lilly i.e., Eli Lilly and Zura Bio go up and down completely randomly.
Pair Corralation between Eli Lilly and Zura Bio
Considering the 90-day investment horizon Eli Lilly and is expected to generate 0.5 times more return on investment than Zura Bio. However, Eli Lilly and is 2.02 times less risky than Zura Bio. It trades about 0.15 of its potential returns per unit of risk. Zura Bio Limited is currently generating about -0.35 per unit of risk. If you would invest 77,200 in Eli Lilly and on November 1, 2024 and sell it today you would earn a total of 5,123 from holding Eli Lilly and or generate 6.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eli Lilly and vs. Zura Bio Limited
Performance |
| Timeline |
| Eli Lilly |
| Zura Bio Limited |
Eli Lilly and Zura Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eli Lilly and Zura Bio
The main advantage of trading using opposite Eli Lilly and Zura Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eli Lilly position performs unexpectedly, Zura Bio 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 Zura Bio will offset losses from the drop in Zura Bio's long position.| Eli Lilly vs. Collegium Pharmaceutical | Eli Lilly vs. Phibro Animal Health | Eli Lilly vs. ANI Pharmaceuticals | Eli Lilly vs. Procaps Group SA |
| Zura Bio vs. Surrozen | Zura Bio vs. Armata Pharmaceuticals | Zura Bio vs. Pasithea Therapeutics Corp | Zura Bio vs. Aditxt 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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