Correlation Between Durect and Structure Therapeutics

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

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

Diversification Opportunities for Durect and Structure Therapeutics

-0.55

Correlation Coefficient

Durect  Structure Therapeutics

Excellent diversification

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

Pair Corralation between Durect and Structure Therapeutics

Given the investment horizon of 90 days Durect is expected to generate 1.4 times more return on investment than Structure Therapeutics. However, Durect is 1.4 times more volatile than Structure Therapeutics American. It trades about 0.14 of its potential returns per unit of risk. Structure Therapeutics American is currently generating about -0.16 per unit of risk. If you would invest  59.00  in Durect on March 22, 2025 and sell it today you would earn a total of  7.00  from holding Durect or generate 11.86% return on investment over 90 days.

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

Durect  vs.  Structure Therapeutics America

Durect

Risk-Adjusted Performance

Very Weak

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

Structure Therapeutics

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Structure Therapeutics American are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating fundamental indicators, Structure Therapeutics may actually be approaching a critical reversion point that can send shares even higher in July 2025.

Pair Trading with Durect and Structure Therapeutics

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

The idea behind Durect and Structure Therapeutics American 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.