Correlation Between Lixte Biotechnology and Equillium
Can any of the company-specific risk be diversified away by investing in both Lixte Biotechnology and Equillium 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 Lixte Biotechnology and Equillium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lixte Biotechnology Holdings and Equillium, you can compare the effects of market volatilities on Lixte Biotechnology and Equillium 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 Lixte Biotechnology with a short position of Equillium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lixte Biotechnology and Equillium.
Diversification Opportunities for Lixte Biotechnology and Equillium
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lixte and Equillium is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Lixte Biotechnology Holdings and Equillium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equillium and Lixte Biotechnology 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 Lixte Biotechnology Holdings are associated (or correlated) with Equillium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equillium has no effect on the direction of Lixte Biotechnology i.e., Lixte Biotechnology and Equillium go up and down completely randomly.
Pair Corralation between Lixte Biotechnology and Equillium
Assuming the 90 days horizon Lixte Biotechnology Holdings is expected to generate 2.66 times more return on investment than Equillium. However, Lixte Biotechnology is 2.66 times more volatile than Equillium. It trades about 0.05 of its potential returns per unit of risk. Equillium is currently generating about -0.16 per unit of risk. If you would invest 2.10 in Lixte Biotechnology Holdings on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Lixte Biotechnology Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lixte Biotechnology Holdings vs. Equillium
Performance |
| Timeline |
| Lixte Biotechnology |
| Equillium |
Lixte Biotechnology and Equillium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lixte Biotechnology and Equillium
The main advantage of trading using opposite Lixte Biotechnology and Equillium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lixte Biotechnology position performs unexpectedly, Equillium 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 Equillium will offset losses from the drop in Equillium's long position.| Lixte Biotechnology vs. Reviva Pharmaceuticals Holdings | Lixte Biotechnology vs. CannBioRx Life Sciences |
| Equillium vs. Lyra Therapeutics | Equillium vs. Hookipa Pharma | Equillium vs. Jasper Therapeutics | Equillium vs. Cingulate Warrants |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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