Correlation Between Imunon and Lixte Biotechnology

Can any of the company-specific risk be diversified away by investing in both Imunon and Lixte Biotechnology 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 Imunon and Lixte Biotechnology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Imunon Inc and Lixte Biotechnology Holdings, you can compare the effects of market volatilities on Imunon and Lixte Biotechnology 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 Imunon with a short position of Lixte Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imunon and Lixte Biotechnology.

Diversification Opportunities for Imunon and Lixte Biotechnology

0.36

Correlation Coefficient

Imunon  Lixte Biotechnology

Weak diversification

The 3 months correlation between Imunon and Lixte is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Imunon Inc and Lixte Biotechnology Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lixte Biotechnology and Imunon 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 Imunon Inc are associated (or correlated) with Lixte Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lixte Biotechnology has no effect on the direction of Imunon i.e., Imunon and Lixte Biotechnology go up and down completely randomly.

Pair Corralation between Imunon and Lixte Biotechnology

Given the investment horizon of 90 days Imunon Inc is expected to under-perform the Lixte Biotechnology. But the stock apears to be less risky and, when comparing its historical volatility, Imunon Inc is 2.41 times less risky than Lixte Biotechnology. The stock trades about -0.1 of its potential returns per unit of risk. The Lixte Biotechnology Holdings is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  200.00  in Lixte Biotechnology Holdings on September 18, 2024 and sell it today you would lose (1.00) from holding Lixte Biotechnology Holdings or give up 0.5% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Imunon Inc  vs.  Lixte Biotechnology Holdings

Imunon Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Imunon Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Lixte Biotechnology

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lixte Biotechnology Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Lixte Biotechnology unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Imunon and Lixte Biotechnology

The main advantage of trading using opposite Imunon and Lixte Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imunon position performs unexpectedly, Lixte Biotechnology 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 Lixte Biotechnology will offset losses from the drop in Lixte Biotechnology's long position.

The idea behind Imunon Inc and Lixte Biotechnology Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.