Correlation Between Lifevantage and Yuexiu Transport

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Can any of the company-specific risk be diversified away by investing in both Lifevantage and Yuexiu Transport 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 Lifevantage and Yuexiu Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifevantage and Yuexiu Transport Infrastructure, you can compare the effects of market volatilities on Lifevantage and Yuexiu Transport 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 Lifevantage with a short position of Yuexiu Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifevantage and Yuexiu Transport.

Diversification Opportunities for Lifevantage and Yuexiu Transport

0.77
  Correlation Coefficient

Poor diversification

The 3 months correlation between Lifevantage and Yuexiu is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Lifevantage and Yuexiu Transport Infrastructur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuexiu Transport Inf and Lifevantage 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 Lifevantage are associated (or correlated) with Yuexiu Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuexiu Transport Inf has no effect on the direction of Lifevantage i.e., Lifevantage and Yuexiu Transport go up and down completely randomly.

Pair Corralation between Lifevantage and Yuexiu Transport

If you would invest  1,379  in Lifevantage on September 24, 2024 and sell it today you would earn a total of  357.00  from holding Lifevantage or generate 25.89% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Lifevantage  vs.  Yuexiu Transport Infrastructur

 Performance 
       Timeline  
Lifevantage 

Risk-Adjusted Performance

15 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Lifevantage are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Lifevantage displayed solid returns over the last few months and may actually be approaching a breakup point.
Yuexiu Transport Inf 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Yuexiu Transport Infrastructure are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal basic indicators, Yuexiu Transport reported solid returns over the last few months and may actually be approaching a breakup point.

Lifevantage and Yuexiu Transport Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Lifevantage and Yuexiu Transport

The main advantage of trading using opposite Lifevantage and Yuexiu Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifevantage position performs unexpectedly, Yuexiu Transport 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 Yuexiu Transport will offset losses from the drop in Yuexiu Transport's long position.
The idea behind Lifevantage and Yuexiu Transport Infrastructure 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.

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