Correlation Between Loews Corp and Binah Capital

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

By analyzing existing cross correlation between Loews Corp and Binah Capital Group,, you can compare the effects of market volatilities on Loews Corp and Binah Capital 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 Loews Corp with a short position of Binah Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loews Corp and Binah Capital.

Diversification Opportunities for Loews Corp and Binah Capital

-0.05

Correlation Coefficient

Loews Corp  Binah Capital

Good diversification

The 3 months correlation between Loews and Binah is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Loews Corp and Binah Capital Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binah Capital Group, and Loews Corp 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 Loews Corp are associated (or correlated) with Binah Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binah Capital Group, has no effect on the direction of Loews Corp i.e., Loews Corp and Binah Capital go up and down completely randomly.

Pair Corralation between Loews Corp and Binah Capital

Taking into account the 90-day investment horizon Loews Corp is expected to generate 1.31 times less return on investment than Binah Capital. But when comparing it to its historical volatility, Loews Corp is 10.17 times less risky than Binah Capital. It trades about 0.05 of its potential returns per unit of risk. Binah Capital Group, is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  261.00  in Binah Capital Group, on December 17, 2024 and sell it today you would lose (69.00) from holding Binah Capital Group, or give up 26.44% of portfolio value over 90 days.

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

Loews Corp  vs.  Binah Capital Group,

Loews Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Loews Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, Loews Corp is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Binah Capital Group,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Binah Capital Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Binah Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Loews Corp and Binah Capital

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

The idea behind Loews Corp and Binah Capital Group, 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.