Correlation Between LIFE Old and Cybin

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

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

Diversification Opportunities for LIFE Old and Cybin

-0.09

Correlation Coefficient

LIFE Old  Cybin

Good diversification

The 3 months correlation between LIFE and Cybin is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding LIFE Old and Cybin Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cybin Inc and LIFE Old 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 LIFE Old are associated (or correlated) with Cybin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cybin Inc has no effect on the direction of LIFE Old i.e., LIFE Old and Cybin go up and down completely randomly.

Pair Corralation between LIFE Old and Cybin

If you would invest  906.00  in Cybin Inc on October 26, 2024 and sell it today you would earn a total of  113.00  from holding Cybin Inc or generate 12.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

LIFE Old  vs.  Cybin Inc

LIFE Old

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LIFE Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, LIFE Old is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Cybin Inc

Risk-Adjusted Performance

0 of 100

Weak

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

Pair Trading with LIFE Old and Cybin

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

The idea behind LIFE Old and Cybin Inc 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.