Correlation Between Lifevantage and TG Venture

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

By analyzing existing cross correlation between Lifevantage and TG Venture Acquisition, you can compare the effects of market volatilities on Lifevantage and TG Venture 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 TG Venture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifevantage and TG Venture.

Diversification Opportunities for Lifevantage and TG Venture

0.0

Correlation Coefficient

Lifevantage  TG Venture

Pay attention - limited upside

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

Pair Corralation between Lifevantage and TG Venture

If you would invest  1,631  in Lifevantage on December 22, 2024 and sell it today you would lose (85.00) from holding Lifevantage or give up 5.21% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.64%
Values	Daily Returns

Lifevantage  vs.  TG Venture Acquisition

Lifevantage

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lifevantage has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Lifevantage is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

TG Venture Acquisition

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Lifevantage and TG Venture

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

The idea behind Lifevantage and TG Venture Acquisition 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.