Correlation Between Lyra Therapeutics and Alx Oncology
Can any of the company-specific risk be diversified away by investing in both Lyra Therapeutics and Alx Oncology 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 Lyra Therapeutics and Alx Oncology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyra Therapeutics and Alx Oncology Holdings, you can compare the effects of market volatilities on Lyra Therapeutics and Alx Oncology 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 Lyra Therapeutics with a short position of Alx Oncology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyra Therapeutics and Alx Oncology.
Diversification Opportunities for Lyra Therapeutics and Alx Oncology
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lyra and Alx is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Lyra Therapeutics and Alx Oncology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alx Oncology Holdings and Lyra Therapeutics 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 Lyra Therapeutics are associated (or correlated) with Alx Oncology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alx Oncology Holdings has no effect on the direction of Lyra Therapeutics i.e., Lyra Therapeutics and Alx Oncology go up and down completely randomly.
Pair Corralation between Lyra Therapeutics and Alx Oncology
Given the investment horizon of 90 days Lyra Therapeutics is expected to under-perform the Alx Oncology. In addition to that, Lyra Therapeutics is 2.08 times more volatile than Alx Oncology Holdings. It trades about -0.1 of its total potential returns per unit of risk. Alx Oncology Holdings is currently generating about 0.03 per unit of volatility. If you would invest 146.00 in Alx Oncology Holdings on August 27, 2024 and sell it today you would earn a total of 1.00 from holding Alx Oncology Holdings or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyra Therapeutics vs. Alx Oncology Holdings
Performance |
| Timeline |
| Lyra Therapeutics |
| Alx Oncology Holdings |
Lyra Therapeutics and Alx Oncology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyra Therapeutics and Alx Oncology
The main advantage of trading using opposite Lyra Therapeutics and Alx Oncology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyra Therapeutics position performs unexpectedly, Alx Oncology 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 Alx Oncology will offset losses from the drop in Alx Oncology's long position.| Lyra Therapeutics vs. Eliem Therapeutics | Lyra Therapeutics vs. HCW Biologics | Lyra Therapeutics vs. Scpharmaceuticals | Lyra Therapeutics vs. Milestone Pharmaceuticals |
| Alx Oncology vs. Cabaletta Bio | Alx Oncology vs. Viracta Therapeutics | Alx Oncology vs. Eyepoint Pharmaceuticals | Alx Oncology vs. Biomea Fusion |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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