Correlation Between LIFENET INSURANCE and LTC Properties

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

By analyzing existing cross correlation between LIFENET INSURANCE CO and LTC Properties, you can compare the effects of market volatilities on LIFENET INSURANCE and LTC Properties 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 LIFENET INSURANCE with a short position of LTC Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of LIFENET INSURANCE and LTC Properties.

Diversification Opportunities for LIFENET INSURANCE and LTC Properties

0.0

Correlation Coefficient

LIFENET INSURANCE  LTC Properties

Pay attention - limited upside

The 3 months correlation between LIFENET and LTC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding LIFENET INSURANCE CO and LTC Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LTC Properties and LIFENET INSURANCE 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 LIFENET INSURANCE CO are associated (or correlated) with LTC Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LTC Properties has no effect on the direction of LIFENET INSURANCE i.e., LIFENET INSURANCE and LTC Properties go up and down completely randomly.

Pair Corralation between LIFENET INSURANCE and LTC Properties

If you would invest  1,050  in LIFENET INSURANCE CO on September 3, 2024 and sell it today you would earn a total of  180.00  from holding LIFENET INSURANCE CO or generate 17.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

LIFENET INSURANCE CO  vs.  LTC Properties

LIFENET INSURANCE

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in LIFENET INSURANCE CO are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, LIFENET INSURANCE reported solid returns over the last few months and may actually be approaching a breakup point.

LTC Properties

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in LTC Properties are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, LTC Properties reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with LIFENET INSURANCE and LTC Properties

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

The idea behind LIFENET INSURANCE CO and LTC Properties 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.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.