Correlation Between LianBio ADR and Ibio
Can any of the company-specific risk be diversified away by investing in both LianBio ADR and Ibio 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 LianBio ADR and Ibio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LianBio ADR and Ibio Inc, you can compare the effects of market volatilities on LianBio ADR and Ibio 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 LianBio ADR with a short position of Ibio. Check out your portfolio center. Please also check ongoing floating volatility patterns of LianBio ADR and Ibio.
Diversification Opportunities for LianBio ADR and Ibio
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between LianBio and Ibio is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding LianBio ADR and Ibio Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ibio Inc and LianBio ADR 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 LianBio ADR are associated (or correlated) with Ibio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ibio Inc has no effect on the direction of LianBio ADR i.e., LianBio ADR and Ibio go up and down completely randomly.
Pair Corralation between LianBio ADR and Ibio
If you would invest 108.00 in Ibio Inc on February 20, 2024 and sell it today you would earn a total of 107.00 from holding Ibio Inc or generate 99.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 2.38% |
Values | Daily Returns |
LianBio ADR vs. Ibio Inc
Performance |
Timeline |
LianBio ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ibio Inc |
LianBio ADR and Ibio Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with LianBio ADR and Ibio
The main advantage of trading using opposite LianBio ADR and Ibio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LianBio ADR position performs unexpectedly, Ibio 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 Ibio will offset losses from the drop in Ibio's long position.LianBio ADR vs. Sensei Biotherapeutics | LianBio ADR vs. NextCure | LianBio ADR vs. Nuvation Bio | LianBio ADR vs. Merrimack Pharmaceuticals |
Ibio vs. International Growth Fund | Ibio vs. MIRA Pharmaceuticals Common | Ibio vs. Fidelity Water Sustainability | Ibio vs. Merck Company |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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