Correlation Between Bill and Lipocine
Can any of the company-specific risk be diversified away by investing in both Bill 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 Bill and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bill Com Holdings and Lipocine, you can compare the effects of market volatilities on Bill 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 Bill with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bill and Lipocine.
Diversification Opportunities for Bill and Lipocine
Modest diversification
The 3 months correlation between Bill and Lipocine is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Bill Com Holdings and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and Bill 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 Bill Com Holdings 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 Bill i.e., Bill and Lipocine go up and down completely randomly.
Pair Corralation between Bill and Lipocine
Given the investment horizon of 90 days Bill Com Holdings is expected to generate 0.8 times more return on investment than Lipocine. However, Bill Com Holdings is 1.24 times less risky than Lipocine. It trades about 0.51 of its potential returns per unit of risk. Lipocine is currently generating about -0.03 per unit of risk. If you would invest 5,669 in Bill Com Holdings on August 27, 2024 and sell it today you would earn a total of 3,482 from holding Bill Com Holdings or generate 61.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bill Com Holdings vs. Lipocine
Performance |
| Timeline |
| Bill Com Holdings |
| Lipocine |
Bill and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bill and Lipocine
The main advantage of trading using opposite Bill and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bill 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 Bill Com Holdings 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.| Lipocine vs. Capricor Therapeutics | Lipocine vs. Soleno Therapeutics | Lipocine vs. Bio Path Holdings | Lipocine vs. Moleculin Biotech |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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