Correlation Between Lipocine and Lizhi
Can any of the company-specific risk be diversified away by investing in both Lipocine and Lizhi 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 Lizhi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lipocine and Lizhi Inc, you can compare the effects of market volatilities on Lipocine and Lizhi 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 Lizhi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lipocine and Lizhi.
Diversification Opportunities for Lipocine and Lizhi
Excellent diversification
The 3 months correlation between Lipocine and Lizhi is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Lipocine and Lizhi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lizhi Inc 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 Lizhi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lizhi Inc has no effect on the direction of Lipocine i.e., Lipocine and Lizhi go up and down completely randomly.
Pair Corralation between Lipocine and Lizhi
Given the investment horizon of 90 days Lipocine is expected to under-perform the Lizhi. But the stock apears to be less risky and, when comparing its historical volatility, Lipocine is 1.31 times less risky than Lizhi. The stock trades about -0.02 of its potential returns per unit of risk. The Lizhi Inc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 176.00 in Lizhi Inc on December 4, 2024 and sell it today you would earn a total of 48.00 from holding Lizhi Inc or generate 27.27% 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. Lizhi Inc
Performance |
| Timeline |
| Lipocine |
| Lizhi Inc |
Lipocine and Lizhi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lipocine and Lizhi
The main advantage of trading using opposite Lipocine and Lizhi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lipocine position performs unexpectedly, Lizhi 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 Lizhi will offset losses from the drop in Lizhi's long position.| Lipocine vs. Reviva Pharmaceuticals Holdings | Lipocine vs. ZyVersa Therapeutics | Lipocine vs. Unicycive Therapeutics | Lipocine vs. Checkpoint Therapeutics |
| Lizhi vs. Cresud SACIF y | Lizhi vs. MYT Netherlands Parent | Lizhi vs. National Vision Holdings | Lizhi vs. Titan Machinery |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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