Correlation Between Lipocine and AstraZeneca PLC
Can any of the company-specific risk be diversified away by investing in both Lipocine and AstraZeneca PLC 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 AstraZeneca PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lipocine and AstraZeneca PLC ADR, you can compare the effects of market volatilities on Lipocine and AstraZeneca PLC 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 AstraZeneca PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lipocine and AstraZeneca PLC.
Diversification Opportunities for Lipocine and AstraZeneca PLC
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lipocine and AstraZeneca is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Lipocine and AstraZeneca PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AstraZeneca PLC ADR 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 AstraZeneca PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AstraZeneca PLC ADR has no effect on the direction of Lipocine i.e., Lipocine and AstraZeneca PLC go up and down completely randomly.
Pair Corralation between Lipocine and AstraZeneca PLC
Given the investment horizon of 90 days Lipocine is expected to generate 3.77 times more return on investment than AstraZeneca PLC. However, Lipocine is 3.77 times more volatile than AstraZeneca PLC ADR. It trades about 0.03 of its potential returns per unit of risk. AstraZeneca PLC ADR is currently generating about 0.0 per unit of risk. If you would invest 436.00 in Lipocine on September 2, 2024 and sell it today you would earn a total of 18.00 from holding Lipocine or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lipocine vs. AstraZeneca PLC ADR
Performance |
| Timeline |
| Lipocine |
| AstraZeneca PLC ADR |
Lipocine and AstraZeneca PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lipocine and AstraZeneca PLC
The main advantage of trading using opposite Lipocine and AstraZeneca PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lipocine position performs unexpectedly, AstraZeneca PLC 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 AstraZeneca PLC will offset losses from the drop in AstraZeneca PLC's long position.| Lipocine vs. Reviva Pharmaceuticals Holdings | Lipocine vs. ZyVersa Therapeutics | Lipocine vs. Unicycive Therapeutics | Lipocine vs. Checkpoint Therapeutics |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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