Correlation Between Spyre Therapeutics and NISOURCE

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

By analyzing existing cross correlation between Spyre Therapeutics and NISOURCE INC, you can compare the effects of market volatilities on Spyre Therapeutics and NISOURCE 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 NISOURCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spyre Therapeutics and NISOURCE.

Diversification Opportunities for Spyre Therapeutics and NISOURCE

0.45

Correlation Coefficient

Spyre Therapeutics  NISOURCE

Very weak diversification

The 3 months correlation between Spyre and NISOURCE is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Spyre Therapeutics and NISOURCE INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NISOURCE INC 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 NISOURCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NISOURCE INC has no effect on the direction of Spyre Therapeutics i.e., Spyre Therapeutics and NISOURCE go up and down completely randomly.

Pair Corralation between Spyre Therapeutics and NISOURCE

Given the investment horizon of 90 days Spyre Therapeutics is expected to generate 5.14 times more return on investment than NISOURCE. However, Spyre Therapeutics is 5.14 times more volatile than NISOURCE INC. It trades about 0.04 of its potential returns per unit of risk. NISOURCE INC is currently generating about -0.02 per unit of risk. If you would invest  1,961  in Spyre Therapeutics on October 3, 2024 and sell it today you would earn a total of  367.00  from holding Spyre Therapeutics or generate 18.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	83.15%
Values	Daily Returns

Spyre Therapeutics  vs.  NISOURCE INC

Spyre Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Spyre Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

NISOURCE INC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NISOURCE INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for NISOURCE INC investors.

Pair Trading with Spyre Therapeutics and NISOURCE

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

The idea behind Spyre Therapeutics and NISOURCE INC 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.