Correlation Between Salarius Pharmaceuticals and Vyne Therapeutics

Can any of the company-specific risk be diversified away by investing in both Salarius Pharmaceuticals and Vyne Therapeutics 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 Salarius Pharmaceuticals and Vyne Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Salarius Pharmaceuticals and Vyne Therapeutics, you can compare the effects of market volatilities on Salarius Pharmaceuticals and Vyne Therapeutics 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 Salarius Pharmaceuticals with a short position of Vyne Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salarius Pharmaceuticals and Vyne Therapeutics.

Diversification Opportunities for Salarius Pharmaceuticals and Vyne Therapeutics

-0.15

Correlation Coefficient

Salarius Pharmaceuticals  Vyne Therapeutics

Good diversification

The 3 months correlation between Salarius and Vyne is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Salarius Pharmaceuticals and Vyne Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vyne Therapeutics and Salarius Pharmaceuticals 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 Salarius Pharmaceuticals are associated (or correlated) with Vyne Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vyne Therapeutics has no effect on the direction of Salarius Pharmaceuticals i.e., Salarius Pharmaceuticals and Vyne Therapeutics go up and down completely randomly.

Pair Corralation between Salarius Pharmaceuticals and Vyne Therapeutics

Given the investment horizon of 90 days Salarius Pharmaceuticals is expected to generate 3.81 times less return on investment than Vyne Therapeutics. In addition to that, Salarius Pharmaceuticals is 1.22 times more volatile than Vyne Therapeutics. It trades about 0.03 of its total potential returns per unit of risk. Vyne Therapeutics is currently generating about 0.14 per unit of volatility. If you would invest  184.00  in Vyne Therapeutics on September 13, 2024 and sell it today you would earn a total of  71.00  from holding Vyne Therapeutics or generate 38.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Salarius Pharmaceuticals  vs.  Vyne Therapeutics

Salarius Pharmaceuticals

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Salarius Pharmaceuticals are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent basic indicators, Salarius Pharmaceuticals may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Vyne Therapeutics

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vyne Therapeutics are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, Vyne Therapeutics exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Salarius Pharmaceuticals and Vyne Therapeutics

The main advantage of trading using opposite Salarius Pharmaceuticals and Vyne Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salarius Pharmaceuticals position performs unexpectedly, Vyne Therapeutics 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 Vyne Therapeutics will offset losses from the drop in Vyne Therapeutics' long position.

The idea behind Salarius Pharmaceuticals and Vyne Therapeutics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.