Correlation Between CAMP4 THERAPEUTICS and Lantronix

Can any of the company-specific risk be diversified away by investing in both CAMP4 THERAPEUTICS and Lantronix 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 CAMP4 THERAPEUTICS and Lantronix into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CAMP4 THERAPEUTICS PORATION and Lantronix, you can compare the effects of market volatilities on CAMP4 THERAPEUTICS and Lantronix 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 CAMP4 THERAPEUTICS with a short position of Lantronix. Check out your portfolio center. Please also check ongoing floating volatility patterns of CAMP4 THERAPEUTICS and Lantronix.

Diversification Opportunities for CAMP4 THERAPEUTICS and Lantronix

-0.65

Correlation Coefficient

CAMP4 THERAPEUTICS  Lantronix

Excellent diversification

The 3 months correlation between CAMP4 and Lantronix is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding CAMP4 THERAPEUTICS PORATION and Lantronix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lantronix and CAMP4 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 CAMP4 THERAPEUTICS PORATION are associated (or correlated) with Lantronix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lantronix has no effect on the direction of CAMP4 THERAPEUTICS i.e., CAMP4 THERAPEUTICS and Lantronix go up and down completely randomly.

Pair Corralation between CAMP4 THERAPEUTICS and Lantronix

Given the investment horizon of 90 days CAMP4 THERAPEUTICS PORATION is expected to under-perform the Lantronix. In addition to that, CAMP4 THERAPEUTICS is 1.52 times more volatile than Lantronix. It trades about -0.02 of its total potential returns per unit of risk. Lantronix is currently generating about 0.14 per unit of volatility. If you would invest  221.00  in Lantronix on May 5, 2025 and sell it today you would earn a total of  73.00  from holding Lantronix or generate 33.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

CAMP4 THERAPEUTICS PORATION  vs.  Lantronix

CAMP4 THERAPEUTICS

Risk-Adjusted Performance

Very Weak

Over the last 90 days CAMP4 THERAPEUTICS PORATION has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable primary indicators, CAMP4 THERAPEUTICS is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Lantronix

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lantronix are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, Lantronix showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CAMP4 THERAPEUTICS and Lantronix

The main advantage of trading using opposite CAMP4 THERAPEUTICS and Lantronix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CAMP4 THERAPEUTICS position performs unexpectedly, Lantronix 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 Lantronix will offset losses from the drop in Lantronix's long position.

The idea behind CAMP4 THERAPEUTICS PORATION and Lantronix 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.