Correlation Between Fennec Pharmaceuticals and Lipocine
Can any of the company-specific risk be diversified away by investing in both Fennec Pharmaceuticals 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 Fennec Pharmaceuticals and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fennec Pharmaceuticals and Lipocine, you can compare the effects of market volatilities on Fennec Pharmaceuticals 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 Fennec Pharmaceuticals with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fennec Pharmaceuticals and Lipocine.
Diversification Opportunities for Fennec Pharmaceuticals and Lipocine
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fennec and Lipocine is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Fennec Pharmaceuticals and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and Fennec Pharmaceuticals 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 Fennec Pharmaceuticals 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 Fennec Pharmaceuticals i.e., Fennec Pharmaceuticals and Lipocine go up and down completely randomly.
Pair Corralation between Fennec Pharmaceuticals and Lipocine
Given the investment horizon of 90 days Fennec Pharmaceuticals is expected to under-perform the Lipocine. But the stock apears to be less risky and, when comparing its historical volatility, Fennec Pharmaceuticals is 1.47 times less risky than Lipocine. The stock trades about 0.0 of its potential returns per unit of risk. The Lipocine is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 416.00 in Lipocine on September 12, 2024 and sell it today you would earn a total of 104.00 from holding Lipocine or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fennec Pharmaceuticals vs. Lipocine
Performance |
| Timeline |
| Fennec Pharmaceuticals |
| Lipocine |
Fennec Pharmaceuticals and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fennec Pharmaceuticals and Lipocine
The main advantage of trading using opposite Fennec Pharmaceuticals and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fennec Pharmaceuticals 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.| Fennec Pharmaceuticals vs. Equillium | Fennec Pharmaceuticals vs. DiaMedica Therapeutics | Fennec Pharmaceuticals vs. Valneva SE ADR | Fennec Pharmaceuticals vs. Vivani Medical |
| 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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