Correlation Between Spyre Therapeutics and Bausch Lomb
Can any of the company-specific risk be diversified away by investing in both Spyre Therapeutics and Bausch Lomb 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 Spyre Therapeutics and Bausch Lomb into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spyre Therapeutics and Bausch Lomb Corp, you can compare the effects of market volatilities on Spyre Therapeutics and Bausch Lomb 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 Spyre Therapeutics with a short position of Bausch Lomb. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spyre Therapeutics and Bausch Lomb.
Diversification Opportunities for Spyre Therapeutics and Bausch Lomb
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Spyre and Bausch is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Spyre Therapeutics and Bausch Lomb Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bausch Lomb Corp and Spyre 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 Spyre Therapeutics are associated (or correlated) with Bausch Lomb. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bausch Lomb Corp has no effect on the direction of Spyre Therapeutics i.e., Spyre Therapeutics and Bausch Lomb go up and down completely randomly.
Pair Corralation between Spyre Therapeutics and Bausch Lomb
Given the investment horizon of 90 days Spyre Therapeutics is expected to under-perform the Bausch Lomb. In addition to that, Spyre Therapeutics is 1.59 times more volatile than Bausch Lomb Corp. It trades about -0.13 of its total potential returns per unit of risk. Bausch Lomb Corp is currently generating about -0.13 per unit of volatility. If you would invest 1,947 in Bausch Lomb Corp on December 1, 2024 and sell it today you would lose (347.00) from holding Bausch Lomb Corp or give up 17.82% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Spyre Therapeutics vs. Bausch Lomb Corp
Performance |
Timeline |
Spyre Therapeutics |
Bausch Lomb Corp |
Spyre Therapeutics and Bausch Lomb Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Spyre Therapeutics and Bausch Lomb
The main advantage of trading using opposite Spyre Therapeutics and Bausch Lomb positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spyre Therapeutics position performs unexpectedly, Bausch Lomb 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 Bausch Lomb will offset losses from the drop in Bausch Lomb's long position.Spyre Therapeutics vs. Aldel Financial II | Spyre Therapeutics vs. Highway Holdings Limited | Spyre Therapeutics vs. Park Electrochemical | Spyre Therapeutics vs. Waste Management |
Bausch Lomb vs. The Cooper Companies, | Bausch Lomb vs. ICU Medical | Bausch Lomb vs. Hologic | Bausch Lomb vs. Becton Dickinson and |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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