Correlation Between Keweenaw Land and Limoneira

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

By analyzing existing cross correlation between Keweenaw Land Association and Limoneira Co, you can compare the effects of market volatilities on Keweenaw Land and Limoneira 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 Keweenaw Land with a short position of Limoneira. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keweenaw Land and Limoneira.

Diversification Opportunities for Keweenaw Land and Limoneira

-0.15

Correlation Coefficient

Keweenaw Land  Limoneira

Good diversification

The 3 months correlation between Keweenaw and Limoneira is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Keweenaw Land Association and Limoneira Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Limoneira and Keweenaw Land 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 Keweenaw Land Association are associated (or correlated) with Limoneira. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Limoneira has no effect on the direction of Keweenaw Land i.e., Keweenaw Land and Limoneira go up and down completely randomly.

Pair Corralation between Keweenaw Land and Limoneira

Given the investment horizon of 90 days Keweenaw Land is expected to generate 1.28 times less return on investment than Limoneira. In addition to that, Keweenaw Land is 1.99 times more volatile than Limoneira Co. It trades about 0.03 of its total potential returns per unit of risk. Limoneira Co is currently generating about 0.09 per unit of volatility. If you would invest  2,532  in Limoneira Co on September 12, 2024 and sell it today you would earn a total of  250.50  from holding Limoneira Co or generate 9.89% return on investment over 90 days.

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

Keweenaw Land Association  vs.  Limoneira Co

Keweenaw Land Association

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Keweenaw Land Association are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile basic indicators, Keweenaw Land may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Limoneira

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Limoneira Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Limoneira may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Keweenaw Land and Limoneira

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

The idea behind Keweenaw Land Association and Limoneira Co 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.