Correlation Between Lipocine and Turquoise Hill

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

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

Diversification Opportunities for Lipocine and Turquoise Hill

0.0

Correlation Coefficient

Lipocine  Turquoise Hill

Pay attention - limited upside

The 3 months correlation between Lipocine and Turquoise is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lipocine and Turquoise Hill Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turquoise Hill Resources and Lipocine 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 Lipocine are associated (or correlated) with Turquoise Hill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turquoise Hill Resources has no effect on the direction of Lipocine i.e., Lipocine and Turquoise Hill go up and down completely randomly.

Pair Corralation between Lipocine and Turquoise Hill

If you would invest (100.00) in Turquoise Hill Resources on December 4, 2024 and sell it today you would earn a total of  100.00  from holding Turquoise Hill Resources or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Lipocine  vs.  Turquoise Hill Resources

Lipocine

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lipocine has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Turquoise Hill Resources

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Lipocine and Turquoise Hill

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

The idea behind Lipocine and Turquoise Hill Resources 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.