Correlation Between Pan Global and Lifevantage

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

By analyzing existing cross correlation between Pan Global Resources and Lifevantage, you can compare the effects of market volatilities on Pan Global and Lifevantage 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 Pan Global with a short position of Lifevantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Global and Lifevantage.

Diversification Opportunities for Pan Global and Lifevantage

-0.75

Correlation Coefficient

Pan Global  Lifevantage

Pay attention - limited upside

The 3 months correlation between Pan and Lifevantage is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Pan Global Resources and Lifevantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifevantage and Pan Global 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 Pan Global Resources are associated (or correlated) with Lifevantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifevantage has no effect on the direction of Pan Global i.e., Pan Global and Lifevantage go up and down completely randomly.

Pair Corralation between Pan Global and Lifevantage

Assuming the 90 days horizon Pan Global Resources is expected to under-perform the Lifevantage. In addition to that, Pan Global is 1.06 times more volatile than Lifevantage. It trades about -0.05 of its total potential returns per unit of risk. Lifevantage is currently generating about 0.22 per unit of volatility. If you would invest  990.00  in Lifevantage on September 15, 2024 and sell it today you would earn a total of  614.00  from holding Lifevantage or generate 62.02% return on investment over 90 days.

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

Pan Global Resources  vs.  Lifevantage

Pan Global Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pan Global Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Lifevantage

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lifevantage are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of very unsteady basic indicators, Lifevantage displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pan Global and Lifevantage

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

The idea behind Pan Global Resources and Lifevantage 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.