Correlation Between CARGOJET INC and Lifeway Foods
Can any of the company-specific risk be diversified away by investing in both CARGOJET INC and Lifeway Foods 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 CARGOJET INC and Lifeway Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CARGOJET INC VAR and Lifeway Foods, you can compare the effects of market volatilities on CARGOJET INC and Lifeway Foods 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 CARGOJET INC with a short position of Lifeway Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of CARGOJET INC and Lifeway Foods.
Diversification Opportunities for CARGOJET INC and Lifeway Foods
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CARGOJET and Lifeway is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding CARGOJET INC VAR and Lifeway Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifeway Foods and CARGOJET INC 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 CARGOJET INC VAR are associated (or correlated) with Lifeway Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifeway Foods has no effect on the direction of CARGOJET INC i.e., CARGOJET INC and Lifeway Foods go up and down completely randomly.
Pair Corralation between CARGOJET INC and Lifeway Foods
Assuming the 90 days trading horizon CARGOJET INC VAR is expected to under-perform the Lifeway Foods. But the stock apears to be less risky and, when comparing its historical volatility, CARGOJET INC VAR is 1.02 times less risky than Lifeway Foods. The stock trades about -0.15 of its potential returns per unit of risk. The Lifeway Foods is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 2,260 in Lifeway Foods on December 30, 2024 and sell it today you would lose (40.00) from holding Lifeway Foods or give up 1.77% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
CARGOJET INC VAR vs. Lifeway Foods
Performance |
Timeline |
CARGOJET INC VAR |
Lifeway Foods |
CARGOJET INC and Lifeway Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CARGOJET INC and Lifeway Foods
The main advantage of trading using opposite CARGOJET INC and Lifeway Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CARGOJET INC position performs unexpectedly, Lifeway Foods 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 Lifeway Foods will offset losses from the drop in Lifeway Foods' long position.CARGOJET INC vs. Geely Automobile Holdings | CARGOJET INC vs. SHELF DRILLING LTD | CARGOJET INC vs. FIREWEED METALS P | CARGOJET INC vs. Stag Industrial |
Lifeway Foods vs. Nestl SA | Lifeway Foods vs. Kraft Heinz Co | Lifeway Foods vs. General Mills | Lifeway Foods vs. Danone SA |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Share Portfolio Track or share privately all of your investments from the convenience of any device |