Correlation Between Live Ventures and Continental
Can any of the company-specific risk be diversified away by investing in both Live Ventures and Continental 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 Live Ventures and Continental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Ventures and Continental AG PK, you can compare the effects of market volatilities on Live Ventures and Continental 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 Live Ventures with a short position of Continental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Ventures and Continental.
Diversification Opportunities for Live Ventures and Continental
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Live and Continental is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Live Ventures and Continental AG PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Continental AG PK and Live Ventures 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 Live Ventures are associated (or correlated) with Continental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Continental AG PK has no effect on the direction of Live Ventures i.e., Live Ventures and Continental go up and down completely randomly.
Pair Corralation between Live Ventures and Continental
Given the investment horizon of 90 days Live Ventures is expected to under-perform the Continental. In addition to that, Live Ventures is 2.27 times more volatile than Continental AG PK. It trades about -0.07 of its total potential returns per unit of risk. Continental AG PK is currently generating about 0.09 per unit of volatility. If you would invest 661.00 in Continental AG PK on December 4, 2024 and sell it today you would earn a total of 50.00 from holding Continental AG PK or generate 7.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Live Ventures vs. Continental AG PK
Performance |
Timeline |
Live Ventures |
Continental AG PK |
Live Ventures and Continental Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Live Ventures and Continental
The main advantage of trading using opposite Live Ventures and Continental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Ventures position performs unexpectedly, Continental 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 Continental will offset losses from the drop in Continental's long position.Live Ventures vs. Arhaus Inc | Live Ventures vs. Floor Decor Holdings | Live Ventures vs. Haverty Furniture Companies | Live Ventures vs. Kingfisher plc |
Continental vs. Compagnie Gnrale des | Continental vs. Bridgestone Corp ADR | Continental vs. Continental Aktiengesellschaft | Continental vs. Douglas Dynamics |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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