Correlation Between National CineMedia and Lipocine
Can any of the company-specific risk be diversified away by investing in both National CineMedia 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 National CineMedia and Lipocine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National CineMedia and Lipocine, you can compare the effects of market volatilities on National CineMedia 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 National CineMedia with a short position of Lipocine. Check out your portfolio center. Please also check ongoing floating volatility patterns of National CineMedia and Lipocine.
Diversification Opportunities for National CineMedia and Lipocine
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between National and Lipocine is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding National CineMedia and Lipocine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipocine and National CineMedia 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 National CineMedia 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 National CineMedia i.e., National CineMedia and Lipocine go up and down completely randomly.
Pair Corralation between National CineMedia and Lipocine
Given the investment horizon of 90 days National CineMedia is expected to generate 0.52 times more return on investment than Lipocine. However, National CineMedia is 1.92 times less risky than Lipocine. It trades about -0.03 of its potential returns per unit of risk. Lipocine is currently generating about -0.2 per unit of risk. If you would invest 717.00 in National CineMedia on September 2, 2024 and sell it today you would lose (22.00) from holding National CineMedia or give up 3.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National CineMedia vs. Lipocine
Performance |
| Timeline |
| National CineMedia |
| Lipocine |
National CineMedia and Lipocine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National CineMedia and Lipocine
The main advantage of trading using opposite National CineMedia and Lipocine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National CineMedia 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.| National CineMedia vs. MGO Global Common | National CineMedia vs. Baosheng Media Group | National CineMedia vs. Glory Star New | National CineMedia vs. Impact Fusion International |
| 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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