Correlation Between Lyra Therapeutics and Ocular Therapeutix
Can any of the company-specific risk be diversified away by investing in both Lyra Therapeutics and Ocular Therapeutix 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 Ocular Therapeutix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lyra Therapeutics and Ocular Therapeutix, you can compare the effects of market volatilities on Lyra Therapeutics and Ocular Therapeutix 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 Ocular Therapeutix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lyra Therapeutics and Ocular Therapeutix.
Diversification Opportunities for Lyra Therapeutics and Ocular Therapeutix
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lyra and Ocular is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Lyra Therapeutics and Ocular Therapeutix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocular Therapeutix 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 Ocular Therapeutix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocular Therapeutix has no effect on the direction of Lyra Therapeutics i.e., Lyra Therapeutics and Ocular Therapeutix go up and down completely randomly.
Pair Corralation between Lyra Therapeutics and Ocular Therapeutix
Given the investment horizon of 90 days Lyra Therapeutics is expected to generate 1.27 times more return on investment than Ocular Therapeutix. However, Lyra Therapeutics is 1.27 times more volatile than Ocular Therapeutix. It trades about 0.24 of its potential returns per unit of risk. Ocular Therapeutix is currently generating about -0.13 per unit of risk. If you would invest 18.00 in Lyra Therapeutics on December 2, 2024 and sell it today you would earn a total of 3.00 from holding Lyra Therapeutics or generate 16.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Lyra Therapeutics vs. Ocular Therapeutix
Performance |
Timeline |
Lyra Therapeutics |
Ocular Therapeutix |
Lyra Therapeutics and Ocular Therapeutix Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lyra Therapeutics and Ocular Therapeutix
The main advantage of trading using opposite Lyra Therapeutics and Ocular Therapeutix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lyra Therapeutics position performs unexpectedly, Ocular Therapeutix 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 Ocular Therapeutix will offset losses from the drop in Ocular Therapeutix's long position.Lyra Therapeutics vs. CytomX Therapeutics | Lyra Therapeutics vs. Assembly Biosciences | Lyra Therapeutics vs. Achilles Therapeutics PLC | Lyra Therapeutics vs. Instil Bio |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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