Correlation Between Cracker Barrel and Lipocine
Can any of the company-specific risk be diversified away by investing in both Cracker Barrel 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 Cracker Barrel and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cracker Barrel Old and Lipocine, you can compare the effects of market volatilities on Cracker Barrel 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 Cracker Barrel with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cracker Barrel and Lipocine.
Diversification Opportunities for Cracker Barrel and Lipocine
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cracker and Lipocine is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Cracker Barrel Old and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and Cracker Barrel 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 Cracker Barrel Old 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 Cracker Barrel i.e., Cracker Barrel and Lipocine go up and down completely randomly.
Pair Corralation between Cracker Barrel and Lipocine
Given the investment horizon of 90 days Cracker Barrel is expected to generate 335.45 times less return on investment than Lipocine. But when comparing it to its historical volatility, Cracker Barrel Old is 1.83 times less risky than Lipocine. It trades about 0.0 of its potential returns per unit of risk. Lipocine is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 260.00 in Lipocine on September 1, 2024 and sell it today you would earn a total of 194.00 from holding Lipocine or generate 74.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cracker Barrel Old vs. Lipocine
Performance |
| Timeline |
| Cracker Barrel Old |
| Lipocine |
Cracker Barrel and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cracker Barrel and Lipocine
The main advantage of trading using opposite Cracker Barrel and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cracker Barrel 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.| Cracker Barrel vs. The Wendys Co | Cracker Barrel vs. Shake Shack | Cracker Barrel vs. Papa Johns International | Cracker Barrel vs. Darden Restaurants |
| 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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