Correlation Between Lineage Cell and Ilex Medical
Can any of the company-specific risk be diversified away by investing in both Lineage Cell and Ilex Medical 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 Lineage Cell and Ilex Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lineage Cell Therapeutics and Ilex Medical, you can compare the effects of market volatilities on Lineage Cell and Ilex Medical 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 Lineage Cell with a short position of Ilex Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lineage Cell and Ilex Medical.
Diversification Opportunities for Lineage Cell and Ilex Medical
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lineage and Ilex is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Lineage Cell Therapeutics and Ilex Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ilex Medical and Lineage Cell 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 Lineage Cell Therapeutics are associated (or correlated) with Ilex Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ilex Medical has no effect on the direction of Lineage Cell i.e., Lineage Cell and Ilex Medical go up and down completely randomly.
Pair Corralation between Lineage Cell and Ilex Medical
Assuming the 90 days trading horizon Lineage Cell Therapeutics is expected to under-perform the Ilex Medical. In addition to that, Lineage Cell is 3.35 times more volatile than Ilex Medical. It trades about -0.27 of its total potential returns per unit of risk. Ilex Medical is currently generating about 0.51 per unit of volatility. If you would invest 657,900 in Ilex Medical on September 13, 2024 and sell it today you would earn a total of 166,000 from holding Ilex Medical or generate 25.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lineage Cell Therapeutics vs. Ilex Medical
Performance |
| Timeline |
| Lineage Cell Therapeutics |
| Ilex Medical |
Lineage Cell and Ilex Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lineage Cell and Ilex Medical
The main advantage of trading using opposite Lineage Cell and Ilex Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lineage Cell position performs unexpectedly, Ilex Medical 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 Ilex Medical will offset losses from the drop in Ilex Medical's long position.| Lineage Cell vs. Retailors | Lineage Cell vs. Clal Insurance Enterprises | Lineage Cell vs. Victory Supermarket Chain | Lineage Cell vs. Teuza A Fairchild |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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