Correlation Between Fresh Tracks and Lisata Therapeutics

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

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

Diversification Opportunities for Fresh Tracks and Lisata Therapeutics

-0.55

Correlation Coefficient

Fresh Tracks  Lisata Therapeutics

Excellent diversification

The 3 months correlation between Fresh and Lisata is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Fresh Tracks Therapeutics and Lisata Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lisata Therapeutics and Fresh Tracks 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 Fresh Tracks Therapeutics are associated (or correlated) with Lisata Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lisata Therapeutics has no effect on the direction of Fresh Tracks i.e., Fresh Tracks and Lisata Therapeutics go up and down completely randomly.

Pair Corralation between Fresh Tracks and Lisata Therapeutics

If you would invest  78.00  in Fresh Tracks Therapeutics on September 17, 2024 and sell it today you would earn a total of  0.00  from holding Fresh Tracks Therapeutics or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	1.54%
Values	Daily Returns

Fresh Tracks Therapeutics  vs.  Lisata Therapeutics

Fresh Tracks Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Fresh Tracks Therapeutics has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Fresh Tracks is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Lisata Therapeutics

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Fresh Tracks and Lisata Therapeutics

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

The idea behind Fresh Tracks Therapeutics and Lisata 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.