Correlation Between Comstock Holding and Lifevantage

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

Diversification Opportunities for Comstock Holding and Lifevantage

-0.81
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Comstock and Lifevantage is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Comstock Holding Companies and Lifevantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifevantage and Comstock Holding 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 Comstock Holding Companies 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 Comstock Holding i.e., Comstock Holding and Lifevantage go up and down completely randomly.

Pair Corralation between Comstock Holding and Lifevantage

Given the investment horizon of 90 days Comstock Holding is expected to generate 1.98 times less return on investment than Lifevantage. But when comparing it to its historical volatility, Comstock Holding Companies is 1.15 times less risky than Lifevantage. It trades about 0.06 of its potential returns per unit of risk. Lifevantage is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  353.00  in Lifevantage on October 4, 2024 and sell it today you would earn a total of  1,415  from holding Lifevantage or generate 400.85% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Comstock Holding Companies  vs.  Lifevantage

 Performance 
       Timeline  
Comstock Holding Com 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Comstock Holding Companies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.
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.

Comstock Holding and Lifevantage Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Comstock Holding and Lifevantage

The main advantage of trading using opposite Comstock Holding and Lifevantage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Comstock Holding 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 Comstock Holding Companies 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.

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