Correlation Between Lion One and Lipocine
Can any of the company-specific risk be diversified away by investing in both Lion One 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 Lion One and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion One Metals and Lipocine, you can compare the effects of market volatilities on Lion One 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 Lion One with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and Lipocine.
Diversification Opportunities for Lion One and Lipocine
Average diversification
The 3 months correlation between Lion and Lipocine is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and Lion One 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 Lion One Metals 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 Lion One i.e., Lion One and Lipocine go up and down completely randomly.
Pair Corralation between Lion One and Lipocine
Assuming the 90 days horizon Lion One Metals is expected to under-perform the Lipocine. But the otc stock apears to be less risky and, when comparing its historical volatility, Lion One Metals is 1.52 times less risky than Lipocine. The otc stock trades about -0.13 of its potential returns per unit of risk. The Lipocine is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 484.00 in Lipocine on September 20, 2024 and sell it today you would lose (10.00) from holding Lipocine or give up 2.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lion One Metals vs. Lipocine
Performance |
| Timeline |
| Lion One Metals |
| Lipocine |
Lion One and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion One and Lipocine
The main advantage of trading using opposite Lion One and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One 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.| Lion One vs. Irving Resources | Lion One vs. Headwater Gold | Lion One vs. Novo Resources Corp | Lion One vs. Snowline Gold Corp |
| Lipocine vs. Emergent Biosolutions | Lipocine vs. Neurocrine Biosciences | Lipocine vs. Teva Pharma Industries | Lipocine vs. Haleon plc |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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