Correlation Between Lipocine and AerSale Corp
Can any of the company-specific risk be diversified away by investing in both Lipocine and AerSale Corp 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 Lipocine and AerSale Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lipocine and AerSale Corp, you can compare the effects of market volatilities on Lipocine and AerSale Corp 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 Lipocine with a short position of AerSale Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lipocine and AerSale Corp.
Diversification Opportunities for Lipocine and AerSale Corp
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lipocine and AerSale is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Lipocine and AerSale Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AerSale Corp and Lipocine 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 Lipocine are associated (or correlated) with AerSale Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AerSale Corp has no effect on the direction of Lipocine i.e., Lipocine and AerSale Corp go up and down completely randomly.
Pair Corralation between Lipocine and AerSale Corp
Given the investment horizon of 90 days Lipocine is expected to under-perform the AerSale Corp. In addition to that, Lipocine is 2.03 times more volatile than AerSale Corp. It trades about -0.02 of its total potential returns per unit of risk. AerSale Corp is currently generating about -0.03 per unit of volatility. If you would invest 743.00 in AerSale Corp on September 1, 2024 and sell it today you would lose (113.00) from holding AerSale Corp or give up 15.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lipocine vs. AerSale Corp
Performance |
| Timeline |
| Lipocine |
| AerSale Corp |
Lipocine and AerSale Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lipocine and AerSale Corp
The main advantage of trading using opposite Lipocine and AerSale Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lipocine position performs unexpectedly, AerSale Corp 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 AerSale Corp will offset losses from the drop in AerSale Corp's long position.| Lipocine vs. Reviva Pharmaceuticals Holdings | Lipocine vs. ZyVersa Therapeutics | Lipocine vs. Unicycive Therapeutics | Lipocine vs. Checkpoint Therapeutics |
| AerSale Corp vs. Corporacion America Airports | AerSale Corp vs. Aeroports de Paris | AerSale Corp vs. Japan Airport Terminal | AerSale Corp vs. Aena SME SA |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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