Correlation Between Transgene and Lumos Pharma
Can any of the company-specific risk be diversified away by investing in both Transgene and Lumos Pharma 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 Transgene and Lumos Pharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transgene SA and Lumos Pharma, you can compare the effects of market volatilities on Transgene and Lumos Pharma 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 Transgene with a short position of Lumos Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transgene and Lumos Pharma.
Diversification Opportunities for Transgene and Lumos Pharma
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Transgene and Lumos is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Transgene SA and Lumos Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumos Pharma and Transgene 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 Transgene SA are associated (or correlated) with Lumos Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumos Pharma has no effect on the direction of Transgene i.e., Transgene and Lumos Pharma go up and down completely randomly.
Pair Corralation between Transgene and Lumos Pharma
Assuming the 90 days horizon Transgene SA is expected to generate 9.69 times more return on investment than Lumos Pharma. However, Transgene is 9.69 times more volatile than Lumos Pharma. It trades about 0.04 of its potential returns per unit of risk. Lumos Pharma is currently generating about 0.03 per unit of risk. If you would invest 1.00 in Transgene SA on November 4, 2024 and sell it today you would earn a total of 158.00 from holding Transgene SA or generate 15800.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 93.15% |
| Values | Daily Returns |
Transgene SA vs. Lumos Pharma
Performance |
| Timeline |
| Transgene SA |
| Lumos Pharma |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Transgene and Lumos Pharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transgene and Lumos Pharma
The main advantage of trading using opposite Transgene and Lumos Pharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transgene position performs unexpectedly, Lumos Pharma 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 Lumos Pharma will offset losses from the drop in Lumos Pharma's long position.| Transgene vs. ANTA Sports Products | Transgene vs. Lindblad Expeditions Holdings | Transgene vs. Toro | Transgene vs. Hasbro Inc |
| Lumos Pharma vs. Shattuck Labs | Lumos Pharma vs. Champions Oncology | Lumos Pharma vs. Century Therapeutics | Lumos Pharma vs. Silo 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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