Correlation Between Lyra Therapeutics and Lineage Cell
Can any of the company-specific risk be diversified away by investing in both Lyra Therapeutics and Lineage Cell 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 Lineage Cell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyra Therapeutics and Lineage Cell Therapeutics, you can compare the effects of market volatilities on Lyra Therapeutics and Lineage Cell 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 Lineage Cell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyra Therapeutics and Lineage Cell.
Diversification Opportunities for Lyra Therapeutics and Lineage Cell
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lyra and Lineage is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Lyra Therapeutics and Lineage Cell Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lineage Cell Therapeutics 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 Lineage Cell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lineage Cell Therapeutics has no effect on the direction of Lyra Therapeutics i.e., Lyra Therapeutics and Lineage Cell go up and down completely randomly.
Pair Corralation between Lyra Therapeutics and Lineage Cell
Given the investment horizon of 90 days Lyra Therapeutics is expected to under-perform the Lineage Cell. But the stock apears to be less risky and, when comparing its historical volatility, Lyra Therapeutics is 2.21 times less risky than Lineage Cell. The stock trades about -0.27 of its potential returns per unit of risk. The Lineage Cell Therapeutics is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 59.00 in Lineage Cell Therapeutics on November 4, 2024 and sell it today you would earn a total of 4.00 from holding Lineage Cell Therapeutics or generate 6.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Lyra Therapeutics vs. Lineage Cell Therapeutics
Performance |
| Timeline |
| Lyra Therapeutics |
| Lineage Cell Therapeutics |
Lyra Therapeutics and Lineage Cell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lyra Therapeutics and Lineage Cell
The main advantage of trading using opposite Lyra Therapeutics and Lineage Cell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyra Therapeutics position performs unexpectedly, Lineage Cell 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 Lineage Cell will offset losses from the drop in Lineage Cell's long position.| Lyra Therapeutics vs. CytomX Therapeutics | Lyra Therapeutics vs. Assembly Biosciences | Lyra Therapeutics vs. Achilles Therapeutics PLC | Lyra Therapeutics vs. Instil Bio |
| Lineage Cell vs. MAIA Biotechnology | Lineage Cell vs. Armata Pharmaceuticals | Lineage Cell vs. Portage Biotech | Lineage Cell vs. Cadrenal Therapeutics, Common |
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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