Correlation Between Academy Sports and Lipocine
Can any of the company-specific risk be diversified away by investing in both Academy Sports 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 Academy Sports and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Academy Sports Outdoors and Lipocine, you can compare the effects of market volatilities on Academy Sports 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 Academy Sports with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Academy Sports and Lipocine.
Diversification Opportunities for Academy Sports and Lipocine
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Academy and Lipocine is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Academy Sports Outdoors and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and Academy Sports 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 Academy Sports Outdoors 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 Academy Sports i.e., Academy Sports and Lipocine go up and down completely randomly.
Pair Corralation between Academy Sports and Lipocine
Considering the 90-day investment horizon Academy Sports is expected to generate 2.5 times less return on investment than Lipocine. But when comparing it to its historical volatility, Academy Sports Outdoors is 2.18 times less risky than Lipocine. It trades about 0.03 of its potential returns per unit of risk. Lipocine is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 466.00 in Lipocine on September 19, 2024 and sell it today you would earn a total of 55.00 from holding Lipocine or generate 11.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Academy Sports Outdoors vs. Lipocine
Performance |
| Timeline |
| Academy Sports Outdoors |
| Lipocine |
Academy Sports and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Academy Sports and Lipocine
The main advantage of trading using opposite Academy Sports and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Academy Sports 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.| Academy Sports vs. Williams Sonoma | Academy Sports vs. AutoZone | Academy Sports vs. Ulta Beauty | Academy Sports vs. Best Buy Co |
| Lipocine vs. Emergent Biosolutions | Lipocine vs. Neurocrine Biosciences | Lipocine vs. Teva Pharma Industries | Lipocine vs. Haleon plc |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |