Correlation Between Lipocine and Valens
Can any of the company-specific risk be diversified away by investing in both Lipocine and Valens 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 Valens into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lipocine and Valens, you can compare the effects of market volatilities on Lipocine and Valens 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 Valens. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lipocine and Valens.
Diversification Opportunities for Lipocine and Valens
Very weak diversification
The 3 months correlation between Lipocine and Valens is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Lipocine and Valens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valens 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 Valens. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valens has no effect on the direction of Lipocine i.e., Lipocine and Valens go up and down completely randomly.
Pair Corralation between Lipocine and Valens
Given the investment horizon of 90 days Lipocine is expected to generate 1.03 times more return on investment than Valens. However, Lipocine is 1.03 times more volatile than Valens. It trades about -0.09 of its potential returns per unit of risk. Valens is currently generating about -0.09 per unit of risk. If you would invest 458.00 in Lipocine on December 28, 2024 and sell it today you would lose (111.00) from holding Lipocine or give up 24.24% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Lipocine vs. Valens
Performance |
Timeline |
Lipocine |
Valens |
Lipocine and Valens Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lipocine and Valens
The main advantage of trading using opposite Lipocine and Valens positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lipocine position performs unexpectedly, Valens 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 Valens will offset losses from the drop in Valens' long position.Lipocine vs. Reviva Pharmaceuticals Holdings | Lipocine vs. ZyVersa Therapeutics | Lipocine vs. Unicycive Therapeutics | Lipocine vs. Checkpoint Therapeutics |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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