Correlation Between Mativ Holdings and Lipocine
Can any of the company-specific risk be diversified away by investing in both Mativ Holdings 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 Mativ Holdings and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mativ Holdings and Lipocine, you can compare the effects of market volatilities on Mativ Holdings 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 Mativ Holdings with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mativ Holdings and Lipocine.
Diversification Opportunities for Mativ Holdings and Lipocine
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mativ and Lipocine is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and Mativ Holdings 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 Mativ Holdings 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 Mativ Holdings i.e., Mativ Holdings and Lipocine go up and down completely randomly.
Pair Corralation between Mativ Holdings and Lipocine
Given the investment horizon of 90 days Mativ Holdings is expected to under-perform the Lipocine. But the stock apears to be less risky and, when comparing its historical volatility, Mativ Holdings is 1.42 times less risky than Lipocine. The stock trades about 0.0 of its potential returns per unit of risk. The Lipocine is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 705.00 in Lipocine on September 2, 2024 and sell it today you would lose (251.00) from holding Lipocine or give up 35.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mativ Holdings vs. Lipocine
Performance |
| Timeline |
| Mativ Holdings |
| Lipocine |
Mativ Holdings and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mativ Holdings and Lipocine
The main advantage of trading using opposite Mativ Holdings and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings 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.| Mativ Holdings vs. Orion Engineered Carbons | Mativ Holdings vs. Select Energy Services | Mativ Holdings vs. Perimeter Solutions SA | Mativ Holdings vs. FutureFuel Corp |
| Lipocine vs. Reviva Pharmaceuticals Holdings | Lipocine vs. ZyVersa Therapeutics | Lipocine vs. Unicycive Therapeutics | Lipocine vs. Checkpoint Therapeutics |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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