Correlation Between Lifevantage and Sabre Corpo

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

By analyzing existing cross correlation between Lifevantage and Sabre Corpo, you can compare the effects of market volatilities on Lifevantage and Sabre Corpo 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 Sabre Corpo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifevantage and Sabre Corpo.

Diversification Opportunities for Lifevantage and Sabre Corpo

0.51

Correlation Coefficient

Lifevantage  Sabre Corpo

Very weak diversification

The 3 months correlation between Lifevantage and Sabre is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Lifevantage and Sabre Corpo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sabre Corpo 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 Sabre Corpo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sabre Corpo has no effect on the direction of Lifevantage i.e., Lifevantage and Sabre Corpo go up and down completely randomly.

Pair Corralation between Lifevantage and Sabre Corpo

Given the investment horizon of 90 days Lifevantage is expected to generate 1.06 times more return on investment than Sabre Corpo. However, Lifevantage is 1.06 times more volatile than Sabre Corpo. It trades about 0.17 of its potential returns per unit of risk. Sabre Corpo is currently generating about 0.02 per unit of risk. If you would invest  1,205  in Lifevantage on September 30, 2024 and sell it today you would earn a total of  580.00  from holding Lifevantage or generate 48.13% return on investment over 90 days.

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

Lifevantage  vs.  Sabre Corpo

Lifevantage

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Lifevantage are ranked lower than 13 (%) 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.

Sabre Corpo

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sabre Corpo are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental drivers, Sabre Corpo is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Lifevantage and Sabre Corpo

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

The idea behind Lifevantage and Sabre Corpo 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.