Correlation Between Lumos Pharma and Marker Therapeutics
Can any of the company-specific risk be diversified away by investing in both Lumos Pharma and Marker 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 Lumos Pharma and Marker Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumos Pharma and Marker Therapeutics, you can compare the effects of market volatilities on Lumos Pharma and Marker 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 Lumos Pharma with a short position of Marker Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumos Pharma and Marker Therapeutics.
Diversification Opportunities for Lumos Pharma and Marker Therapeutics
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lumos and Marker is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Lumos Pharma and Marker Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marker Therapeutics and Lumos Pharma 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 Lumos Pharma are associated (or correlated) with Marker Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marker Therapeutics has no effect on the direction of Lumos Pharma i.e., Lumos Pharma and Marker Therapeutics go up and down completely randomly.
Pair Corralation between Lumos Pharma and Marker Therapeutics
Given the investment horizon of 90 days Lumos Pharma is expected to generate 0.81 times more return on investment than Marker Therapeutics. However, Lumos Pharma is 1.23 times less risky than Marker Therapeutics. It trades about 0.12 of its potential returns per unit of risk. Marker Therapeutics is currently generating about 0.01 per unit of risk. If you would invest 225.00 in Lumos Pharma on August 29, 2024 and sell it today you would earn a total of 205.00 from holding Lumos Pharma or generate 91.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lumos Pharma vs. Marker Therapeutics
Performance |
| Timeline |
| Lumos Pharma |
| Marker Therapeutics |
Lumos Pharma and Marker Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumos Pharma and Marker Therapeutics
The main advantage of trading using opposite Lumos Pharma and Marker Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumos Pharma position performs unexpectedly, Marker 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 Marker Therapeutics will offset losses from the drop in Marker Therapeutics' long position.| Lumos Pharma vs. Shattuck Labs | Lumos Pharma vs. Eliem Therapeutics | Lumos Pharma vs. Champions Oncology | Lumos Pharma vs. Century Therapeutics |
| Marker Therapeutics vs. Lumos Pharma | Marker Therapeutics vs. Exicure | Marker Therapeutics vs. Protagenic Therapeutics | Marker Therapeutics vs. Pmv Pharmaceuticals |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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