Actually the Merck says that mercuric iodide has very good solubility in alcohol and also the equimolar amount of potassium iodide found in Tincture of Iodine should greatly improve its solubility in water.
Merck Index entry:
5932. Mercuric Iodide, Red.
Mercury biniodide. HgI2; mol wt 454.40. Hg 44.14%, I 55.86%. Scarlet-red, heavy, odorless, almost tasteless powder; sensitive to light; at 130 deg becomes yellow, and then red on cooling. Poisonous! d 6.28. mp 259 deg. bp =350 deg and sublimes. Soly in water (25 deg) 0.006 g/100 g. 1 g dissolves in 115 ml alcohol, 20 ml boiling alcohol, about 120 ml ether, about 60 ml acetone, 910 ml chloroform, 75 ml ethyl acetate, 260 ml carbon disulfide, readily in alkali iodides, HgCl2, Na2S2O3; sol
in 230 ml olive oil, 50 ml castor oil. Protect from light.
USE: In anal. chemistry for preparation of Nessler's Reagent (alkaline mercuric potassium iodide solution).
THERAP CAT: Antiseptic (topical).
THERAP CAT (VET): Has been used as a topical antiseptic, counterirritant, vesicant.
Baseline Does Not Exist.