Correlation Between LENSAR and Cytek Biosciences
Can any of the company-specific risk be diversified away by investing in both LENSAR and Cytek Biosciences 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 LENSAR and Cytek Biosciences into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LENSAR Inc and Cytek Biosciences, you can compare the effects of market volatilities on LENSAR and Cytek Biosciences 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 LENSAR with a short position of Cytek Biosciences. Check out your portfolio center. Please also check ongoing floating volatility patterns of LENSAR and Cytek Biosciences.
Diversification Opportunities for LENSAR and Cytek Biosciences
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between LENSAR and Cytek is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding LENSAR Inc and Cytek Biosciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cytek Biosciences and LENSAR 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 LENSAR Inc are associated (or correlated) with Cytek Biosciences. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cytek Biosciences has no effect on the direction of LENSAR i.e., LENSAR and Cytek Biosciences go up and down completely randomly.
Pair Corralation between LENSAR and Cytek Biosciences
Given the investment horizon of 90 days LENSAR Inc is expected to generate 1.52 times more return on investment than Cytek Biosciences. However, LENSAR is 1.52 times more volatile than Cytek Biosciences. It trades about 0.03 of its potential returns per unit of risk. Cytek Biosciences is currently generating about -0.32 per unit of risk. If you would invest 1,083 in LENSAR Inc on December 1, 2024 and sell it today you would earn a total of 4.00 from holding LENSAR Inc or generate 0.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LENSAR Inc vs. Cytek Biosciences
Performance |
| Timeline |
| LENSAR Inc |
| Cytek Biosciences |
LENSAR and Cytek Biosciences Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LENSAR and Cytek Biosciences
The main advantage of trading using opposite LENSAR and Cytek Biosciences positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LENSAR position performs unexpectedly, Cytek Biosciences 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 Cytek Biosciences will offset losses from the drop in Cytek Biosciences' long position.The idea behind LENSAR Inc and Cytek Biosciences pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Cytek Biosciences vs. Orthopediatrics Corp | Cytek Biosciences vs. Electromed | Cytek Biosciences vs. Pulmonx Corp | Cytek Biosciences vs. Rxsight |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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