Correlation Between Lyra Therapeutics and DBV Technologies
Can any of the company-specific risk be diversified away by investing in both Lyra Therapeutics and DBV Technologies 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 DBV Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyra Therapeutics and DBV Technologies, you can compare the effects of market volatilities on Lyra Therapeutics and DBV Technologies 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 DBV Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyra Therapeutics and DBV Technologies.
Diversification Opportunities for Lyra Therapeutics and DBV Technologies
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lyra and DBV is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Lyra Therapeutics and DBV Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBV Technologies 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 DBV Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBV Technologies has no effect on the direction of Lyra Therapeutics i.e., Lyra Therapeutics and DBV Technologies go up and down completely randomly.
Pair Corralation between Lyra Therapeutics and DBV Technologies
Given the investment horizon of 90 days Lyra Therapeutics is expected to generate 1.42 times more return on investment than DBV Technologies. However, Lyra Therapeutics is 1.42 times more volatile than DBV Technologies. It trades about -0.02 of its potential returns per unit of risk. DBV Technologies is currently generating about -0.04 per unit of risk. If you would invest 268.00 in Lyra Therapeutics on September 2, 2024 and sell it today you would lose (247.00) from holding Lyra Therapeutics or give up 92.16% 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. DBV Technologies
Performance |
| Timeline |
| Lyra Therapeutics |
| DBV Technologies |
Lyra Therapeutics and DBV Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyra Therapeutics and DBV Technologies
The main advantage of trading using opposite Lyra Therapeutics and DBV Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyra Therapeutics position performs unexpectedly, DBV Technologies 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 DBV Technologies will offset losses from the drop in DBV Technologies' long position.| Lyra Therapeutics vs. CytomX Therapeutics | Lyra Therapeutics vs. Assembly Biosciences | Lyra Therapeutics vs. Achilles Therapeutics PLC | Lyra Therapeutics vs. Instil Bio |
| DBV Technologies vs. Oric Pharmaceuticals | DBV Technologies vs. Lyra Therapeutics | DBV Technologies vs. Inhibrx | DBV Technologies vs. ESSA Pharma |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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