Correlation Between MACYS and Lipocine

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

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

Diversification Opportunities for MACYS and Lipocine

0.0

Correlation Coefficient

MACYS  Lipocine

Pay attention - limited upside

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

Pair Corralation between MACYS and Lipocine

If you would invest  0.00  in MACYS RETAIL HLDGS on December 25, 2024 and sell it today you would earn a total of  0.00  from holding MACYS RETAIL HLDGS or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.69%
Values	Daily Returns

MACYS RETAIL HLDGS  vs.  Lipocine

MACYS RETAIL HLDGS

Risk-Adjusted Performance

Very Weak

Over the last 90 days MACYS RETAIL HLDGS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, MACYS is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

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.

Pair Trading with MACYS and Lipocine

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

The idea behind MACYS RETAIL HLDGS and Lipocine 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.