Correlation Between Lyra Therapeutics and Annexon
Can any of the company-specific risk be diversified away by investing in both Lyra Therapeutics and Annexon 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 Annexon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyra Therapeutics and Annexon, you can compare the effects of market volatilities on Lyra Therapeutics and Annexon 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 Annexon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyra Therapeutics and Annexon.
Diversification Opportunities for Lyra Therapeutics and Annexon
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lyra and Annexon is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Lyra Therapeutics and Annexon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Annexon 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 Annexon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Annexon has no effect on the direction of Lyra Therapeutics i.e., Lyra Therapeutics and Annexon go up and down completely randomly.
Pair Corralation between Lyra Therapeutics and Annexon
Given the investment horizon of 90 days Lyra Therapeutics is expected to under-perform the Annexon. In addition to that, Lyra Therapeutics is 1.03 times more volatile than Annexon. It trades about -0.03 of its total potential returns per unit of risk. Annexon is currently generating about 0.02 per unit of volatility. If you would invest 710.00 in Annexon on October 21, 2024 and sell it today you would lose (290.00) from holding Annexon or give up 40.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lyra Therapeutics vs. Annexon
Performance |
| Timeline |
| Lyra Therapeutics |
| Annexon |
Lyra Therapeutics and Annexon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyra Therapeutics and Annexon
The main advantage of trading using opposite Lyra Therapeutics and Annexon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyra Therapeutics position performs unexpectedly, Annexon 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 Annexon will offset losses from the drop in Annexon's long position.| Lyra Therapeutics vs. CytomX Therapeutics | Lyra Therapeutics vs. Assembly Biosciences | Lyra Therapeutics vs. Achilles Therapeutics PLC | Lyra Therapeutics vs. Instil Bio |
| Annexon vs. Immix Biopharma | Annexon vs. Cns Pharmaceuticals | Annexon vs. Hepion Pharmaceuticals | Annexon vs. Day One Biopharmaceuticals |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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