Correlation Between Lipocine and LianBio ADR
Can any of the company-specific risk be diversified away by investing in both Lipocine and LianBio ADR 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 LianBio ADR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lipocine and LianBio ADR, you can compare the effects of market volatilities on Lipocine and LianBio ADR 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 LianBio ADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lipocine and LianBio ADR.
Diversification Opportunities for Lipocine and LianBio ADR
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lipocine and LianBio is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Lipocine and LianBio ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LianBio 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 LianBio ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LianBio ADR has no effect on the direction of Lipocine i.e., Lipocine and LianBio ADR go up and down completely randomly.
Pair Corralation between Lipocine and LianBio ADR
If you would invest 218.00 in LianBio ADR on October 25, 2024 and sell it today you would earn a total of 0.00 from holding LianBio ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.67% |
| Values | Daily Returns |
Lipocine vs. LianBio ADR
Performance |
| Timeline |
| Lipocine |
| LianBio ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lipocine and LianBio ADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lipocine and LianBio ADR
The main advantage of trading using opposite Lipocine and LianBio ADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lipocine position performs unexpectedly, LianBio ADR 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 LianBio ADR will offset losses from the drop in LianBio ADR's long position.| Lipocine vs. Terns Pharmaceuticals | Lipocine vs. X4 Pharmaceuticals | Lipocine vs. Day One Biopharmaceuticals | Lipocine vs. Hookipa Pharma |
| LianBio ADR vs. Sensei Biotherapeutics | LianBio ADR vs. NextCure | LianBio ADR vs. Nuvation Bio | LianBio ADR vs. Inozyme Pharma |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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