Correlation Between LithiumBank Resources and Genfit

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

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

Diversification Opportunities for LithiumBank Resources and Genfit

0.39

Correlation Coefficient

LithiumBank Resources  Genfit

Weak diversification

The 3 months correlation between LithiumBank and Genfit is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding LithiumBank Resources Corp and Genfit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genfit and LithiumBank Resources 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 LithiumBank Resources Corp are associated (or correlated) with Genfit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genfit has no effect on the direction of LithiumBank Resources i.e., LithiumBank Resources and Genfit go up and down completely randomly.

Pair Corralation between LithiumBank Resources and Genfit

Assuming the 90 days horizon LithiumBank Resources Corp is expected to under-perform the Genfit. But the otc stock apears to be less risky and, when comparing its historical volatility, LithiumBank Resources Corp is 1.17 times less risky than Genfit. The otc stock trades about -0.21 of its potential returns per unit of risk. The Genfit is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest  414.00  in Genfit on September 14, 2024 and sell it today you would lose (32.01) from holding Genfit or give up 7.73% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

LithiumBank Resources Corp  vs.  Genfit

LithiumBank Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LithiumBank Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's forward-looking signals 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.

Genfit

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genfit has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical and fundamental indicators, Genfit is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with LithiumBank Resources and Genfit

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

The idea behind LithiumBank Resources Corp and Genfit 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.

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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.