Correlation Between Lifevantage and Elmos Semiconductor

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Can any of the company-specific risk be diversified away by investing in both Lifevantage and Elmos Semiconductor 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 Elmos Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifevantage and Elmos Semiconductor SE, you can compare the effects of market volatilities on Lifevantage and Elmos Semiconductor 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 Elmos Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifevantage and Elmos Semiconductor.

Diversification Opportunities for Lifevantage and Elmos Semiconductor

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Lifevantage and Elmos is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lifevantage and Elmos Semiconductor SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elmos Semiconductor 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 Elmos Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elmos Semiconductor has no effect on the direction of Lifevantage i.e., Lifevantage and Elmos Semiconductor go up and down completely randomly.

Pair Corralation between Lifevantage and Elmos Semiconductor

If you would invest  1,528  in Lifevantage on October 3, 2024 and sell it today you would earn a total of  225.00  from holding Lifevantage or generate 14.73% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Lifevantage  vs.  Elmos Semiconductor SE

 Performance 
       Timeline  
Lifevantage 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Lifevantage are ranked lower than 14 (%) 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.
Elmos Semiconductor 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Elmos Semiconductor SE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Elmos Semiconductor is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Lifevantage and Elmos Semiconductor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Lifevantage and Elmos Semiconductor

The main advantage of trading using opposite Lifevantage and Elmos Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifevantage position performs unexpectedly, Elmos Semiconductor 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 Elmos Semiconductor will offset losses from the drop in Elmos Semiconductor's long position.
The idea behind Lifevantage and Elmos Semiconductor SE 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 Global Correlations module to find global opportunities by holding instruments from different markets.

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