Correlation Between Lifevantage and Comstock Holding

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

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

Diversification Opportunities for Lifevantage and Comstock Holding

-0.81

Correlation Coefficient

Lifevantage  Comstock Holding

Pay attention - limited upside

The 3 months correlation between Lifevantage and Comstock is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Lifevantage and Comstock Holding Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comstock Holding Com and Lifevantage 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 Lifevantage are associated (or correlated) with Comstock Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comstock Holding Com has no effect on the direction of Lifevantage i.e., Lifevantage and Comstock Holding go up and down completely randomly.

Pair Corralation between Lifevantage and Comstock Holding

Given the investment horizon of 90 days Lifevantage is expected to generate 1.15 times more return on investment than Comstock Holding. However, Lifevantage is 1.15 times more volatile than Comstock Holding Companies. It trades about 0.1 of its potential returns per unit of risk. Comstock Holding Companies is currently generating about 0.06 per unit of risk. 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 Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Lifevantage  vs.  Comstock Holding Companies

Lifevantage

Risk-Adjusted Performance

15 of 100

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 Com

Risk-Adjusted Performance

0 of 100

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.

Pair Trading with Lifevantage and Comstock Holding

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

The idea behind Lifevantage and Comstock Holding Companies 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.