Correlation Between LB Pharmaceuticals and Benitec Biopharma
Can any of the company-specific risk be diversified away by investing in both LB Pharmaceuticals and Benitec Biopharma 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 LB Pharmaceuticals and Benitec Biopharma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LB Pharmaceuticals Common and Benitec Biopharma Ltd, you can compare the effects of market volatilities on LB Pharmaceuticals and Benitec Biopharma 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 LB Pharmaceuticals with a short position of Benitec Biopharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of LB Pharmaceuticals and Benitec Biopharma.
Diversification Opportunities for LB Pharmaceuticals and Benitec Biopharma
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LBRX and Benitec is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding LB Pharmaceuticals Common and Benitec Biopharma Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benitec Biopharma and LB 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 LB Pharmaceuticals Common are associated (or correlated) with Benitec Biopharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benitec Biopharma has no effect on the direction of LB Pharmaceuticals i.e., LB Pharmaceuticals and Benitec Biopharma go up and down completely randomly.
Pair Corralation between LB Pharmaceuticals and Benitec Biopharma
Given the investment horizon of 90 days LB Pharmaceuticals Common is expected to under-perform the Benitec Biopharma. But the stock apears to be less risky and, when comparing its historical volatility, LB Pharmaceuticals Common is 1.24 times less risky than Benitec Biopharma. The stock trades about -0.07 of its potential returns per unit of risk. The Benitec Biopharma Ltd is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,190 in Benitec Biopharma Ltd on August 10, 2025 and sell it today you would earn a total of 89.00 from holding Benitec Biopharma Ltd or generate 7.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 65.63% |
| Values | Daily Returns |
LB Pharmaceuticals Common vs. Benitec Biopharma Ltd
Performance |
| Timeline |
| LB Pharmaceuticals Common |
| Benitec Biopharma |
LB Pharmaceuticals and Benitec Biopharma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LB Pharmaceuticals and Benitec Biopharma
The main advantage of trading using opposite LB Pharmaceuticals and Benitec Biopharma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LB Pharmaceuticals position performs unexpectedly, Benitec Biopharma 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 Benitec Biopharma will offset losses from the drop in Benitec Biopharma's long position.| LB Pharmaceuticals vs. Replimune Group | LB Pharmaceuticals vs. Altimmune | LB Pharmaceuticals vs. Larimar Therapeutics | LB Pharmaceuticals vs. Tenaya Therapeutics |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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